Abortion complicates U.S. Senate healthcare debate

* Some Senate moderates seek tight ban on funding

* Senate Finance chairman says issue will be worked out

By Donna Smith

WASHINGTON, Nov 9 (Reuters) - A fight over abortion could complicate Senate action on a sweeping U.S. healthcare reform bill as some moderate Democrats on Monday voiced support for a strict ban on using federal funds to pay for the procedure.

Senator Ben Nelson, a moderate Democrat, said he supports abortion language similar to a bill passed by the House of Representatives and would oppose any Senate bill that did not clearly ban the use of federal money for abortions.

"If it doesn't make it clear that it does not pay for abortion then I wouldn't support it," Nelson, who has voiced a number of concerns about the proposed healthcare overhaul, told reporters.

Senate Democratic Leader Harry Reid is struggling to muster the 60 votes needed to advance healthcare reform in the 100-member chamber and he cannot afford to lose any Democrats over the abortion issue.

"It's an additional complication," said Senate Finance Committee Chairman Max Baucus, whose panel shaped the Senate bill. "We'll work it out. We have to get healthcare passed this year and we will."

The House included in its healthcare bill a measure that bars anyone receiving federal subsidies from buying a health policy that covers abortion. A proposed government-run insurance plan, known as the public option, also would be barred from covering abortion.

The healthcare overhaul, a top domestic priority for President Barack Obama, would bring the biggest changes in the $2.5 trillion U.S. healthcare system since the creation of the Medicare government health program for the elderly in 1965.

Democratic Senator Kent Conrad, a moderate who backed an abortion provision similar to the House plan during Senate Finance Committee debate on the issue, said "it's very very hard" to work out abortion language.

"All of us have recognized throughout that there are three things that could really bring this (healthcare reform) down," Conrad said. "One is abortion, the second is people who are here illegally and the third is the public option."

SENATE VERSION

The bill passed by the Senate Finance Committee would require insurers to keep federal subsidies separate from any funds used to pay for abortion. Backers of that provision say it preserves current federal law that bars the use of federal funds to pay for abortion except in cases of rape, incest or to save the life of the mother.

The House narrowly passed its healthcare reform bill on Saturday and the tighter restriction on using federal subsidies to purchase policies with abortion coverage was the price abortion-rights Democrats had to pay in order to win passage of the bill.

If the full Senate passes a bill, differences between the House and Senate versions would have to be reconciled before a single reform bill would go to Obama for his signature.