* Key Democrat says Obama speech breathes life into drive
* Census Bureau says number of uninsured rises slightly
* Nearly 32 million Americans watched Obama’s address
* Obama accepts apology from "You lie!" congressman (Adds White House comment on meeting, paragraphs 16-17)
By John Whitesides and Donna Smith
WASHINGTON, Sept 10 (Reuters) - Democratic leaders promised swift action on a healthcare system overhaul on Thursday after a high-stakes speech by President Barack Obama that earned good public reviews but appeared to change few minds in Congress.
U.S. House of Representatives Speaker Nancy Pelosi told reporters she was confident that Obama by year’s end would sign a healthcare reform bill, his top domestic priority.
Obama’s fellow Democrats hoped the president’s prime-time address on Wednesday to a joint session of the U.S. Congress would dispel public skepticism and generate new momentum for his drive to reshape the $2.5 trillion healthcare industry.
Senate Finance Committee Chairman Max Baucus said many of the plans outlined by Obama mirrored the panel’s proposals and helped build confidence among the "Gang of Six" negotiators -- three Democrats and three Republicans -- trying to craft a bipartisan reform plan.
"The president’s speech breathed new life into what we are doing," Baucus said during a break in a negotiating session. He plans to push forward with a bill next week even if he wins no Republican support.
Obama says the overhaul would cut healthcare costs, improve care and regulate insurers to protect consumers while expanding coverage to millions of Americans now without any health insurance. He has pledged that the proposal, at a cost of $900 billion over 10 years, would not increase the budget deficit.
More than 32 million Americans tuned in to watch Obama’s address on television, according to Nielsen Media Research. The viewership was down 39 percent from Obama’s first address to Congress in February, when 52.3 million watched on television.
Obama, speaking to a nurses group, lamented new U.S. Census Bureau figures showing the number of people without health insurance in the United States rose to 46.3 million in 2008 from 45.7 million a year earlier. (ID:nN10392464)
Obama said his plan would expand coverage to 30 million Americans who are now uninsured, but would not cover illegal immigrants -- as some Republicans have repeatedly claimed -- and others who would refuse insurance even when available.
Three House committees and one Senate panel have finished work on a healthcare bill, leaving the Senate Finance Committee as the final hurdle before each chamber takes up the issue.
Obama accepted an apology from Republican Representative Joe Wilson of South Carolina, who shouted "You lie!" when Obama told Congress his plan would not insure illegal immigrants.
"I‘m a big believer in that we all make mistakes," Obama said. "He apologized quickly and without equivocation and I‘m appreciative of that."
Democrats said Wilson’s opponent in next year’s congressional elections had received 11,000 individual donations totaling more than $400,000 since the incident.
Obama said action was needed urgently on healthcare.
"Now is the time to act, and I will not permit reform to be postponed or imperiled by the usual ideological diversions," Obama told the nurses group. "We have talked this issue to death, year after year, decade after decade, and the time for talk is winding down, the time for bickering has passed."
Obama met with 17 centrist Democratic senators at the White House to discuss healthcare legislation in what the White House said was a positive and constructive meeting.
"There was unanimous agreement with the president’s position that the health care reform bill must not add to the deficit and that provisions must be included to reduce long-term deficits," the White House said in a statement.
While there was optimism Republicans still could come aboard, Democratic Senator Mark Udall said there was "a sentiment that at some point it’s time to act" -- with or without Republicans.
A CNN/Opinion Research Corp. poll showed 67 percent of respondents supported Obama’s healthcare reforms after the speech, compared with 53 percent beforehand, and other snap polls showed gains for Obama.
Republican reaction was far cooler. "It’s not just healthcare. The frustration that people are feeling is about the stimulus bill that’s not working, budget deficits of $1 trillion and more for as far as the eye can see, record levels of public debt," House Republican Leader John Boehner said.
Obama hoped his speech would reclaim control of a debate that has been bogged down in Congress amid a flood of criticism and disputes even as his own public approval figures slipped.
Shares of U.S. health insurers climbed on Wall Street as analysts said Obama’s speech contained no surprises and indicated a new government-run insurance program opposed by the industry was less likely to pass. (ID:nN10384500)
Shares of UnitedHealth Group (UNH.N) and WellPoint Inc WLP.N, the two largest health insurers, each rose about 2.5 percent. Aetna Inc (AET.N) was up more than 2 percent and Cigna Corp (CI.N) jumped more than 5 percent.
In his speech, Obama spelled out what he wanted in any final bill passed by Congress, including affordable coverage for all Americans and creation of an insurance exchange where individuals and small businesses could shop for policies.
He reiterated his support for a government-run insurance plan -- the so-called "public option" -- that has drawn strong opposition from critics who say it would harm insurance companies and amount to a government takeover of the industry. But Obama said the lack of a public option in any final bill would not be a deal-breaker. (Additional reporting by Steve Holland, Thomas Ferraro, Andy Sullivan, Matt Spetalnick and Jill Serjeant; Editing by Will Dunham)