Everyday Americans argue for public healthcare option

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* Concern support for public plan waning in Congress

* Grassroots events planned over next two weeks

By Carey Gillam

KANSAS CITY, Mo., July 10 (Reuters) - Kathy Cook's health insurance premiums of $740 a month are nearly as costly as her mortgage. William McEachen struggles to help his disabled adult daughter get the care and medicines she needs. Business owner Don Phipps is outraged at rapidly rising insurance premiums for himself and his employees.

Stories of personal struggles to find affordable healthcare spilled out across the country this week in street-corner picketing, petition drives and rallies, as supporters of President Barack Obama's healthcare overhaul sought to counter what they fear is a weakening in the reform efforts in the U.S. Congress.

Their concern was that the so-called public option -- a government-run insurance plan that would compete with private insurers and possibly be more affordable and accessible -- may not survive in Washington.

"They seem to be backing off on the public option," said David Quinly of Prairie Village, Kansas, who joined a group of about 40 protesters to picket outside the Kansas City office of U.S. Senator Sam Brownback, a Kansas Republican.

On Thursday alone, more than 150 similar demonstrations were held in communities around the United States, including outside U.S. senators' local offices in Minnesota, Georgia, Texas, Virginia, according to Justin Ruben, executive director of the MoveOn. org, the progressive political action group that organized the activities.

More grassroots events are planned in the next two weeks, he said, which coincides with expected intense activity on a drafting healthcare overhaul in Congress.

"Our big focus is on making sure senators over the next few weeks ... are hearing from the public on the need for a strong public option," said Ruben.

Obama has made overhaul of the $2.5 trillion healthcare system his major policy goal and is pushing for a plan that would rein in costs and cover most of the roughly 46 million uninsured Americans.

BLUE DOGS

The public option is a key component of Obama's plan, but sharp opposition from the insurance industry and from a group of fiscally conservative House of Representatives Democrats, known as the Democratic Blue Dog Coalition, has threatened the viability of that provision.

"It is the most provocative component of reform other than cost ... and it probably won't carry the day," said William Peck, director of the Center for Health Policy at Washington University in St. Louis.

Critics argue a government-run plan could have an unfair advantage over private, for-profit players and could eventually squeeze private companies out of the market.