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UPDATE 3-White House stands by August goal for healthcare

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* Orszag: chances high to get bills by August recess

* Says good progress being made on the legislation (Recasts first paragraph, edits, adds quotes and background)

WASHINGTON, July 19 (Reuters) - The White House budget director on Sunday accused opponents in Congress of trying to kill off plans to overhaul U.S. healthcare but predicted each house would pass a bill in the next two to three weeks.

“There are those who are advocating delay just as a desperation move to try to kill this,” director Peter Orszag said on CNN’s State of the Union on Sunday.

Asked on FOX News Sunday whether the House of Representatives and Senate would meet a target and pass a bill before the August recess, he said, “I think the chances are high.”

Faced with growing concern over the cost of healthcare reform, President Barack Obama has gone on the offensive for his more than $1 trillion plan that would set up a government-run health insurance plan to compete with private insurers, provide coverage to many of the 46 million uninsured and try to stem runaway medical costs.

Reforming the $2.5 trillion U.S. healthcare industry is Obama’s signature domestic issue and a major test of his presidency, but he is running out of time to get the enabling legislation passed this year. A delay to 2010, a congressional election year, could make it harder to win a final deal.

Orszag said he thought good progress was being made on the healthcare legislation, and there were a number of options to curb costs of the bill to keep it from increasing the federal deficit.


Work on the bill was continuing through the weekend, he said. “Remember, none of this is easy. There’s a reason why this hasn’t happened in 50 years, and we’re making a lot of progress,” Orszag said on CNN.

Obama on Saturday repeated that he would “not sign on to any health plan that adds to our deficits over the next decade,” as he called on lawmakers, including skeptics in his own party, to “seize this opportunity -- one we might not have again for generations -- and finally pass health insurance reform this year, in 2009.”

Obama hopes that when Congress returns in September, House and Senate negotiators would be able to deliver a final bill to him before the year is out.

Republicans and some Democrats are complaining that the Democratic president is rushing the issue which could result in costly mistakes that would worsen U.S. healthcare.

“He knows he can’t sell it ... if the debate lasts very long because it is so expensive and costly,” Republican Senator Orrin Hatch said on CBS’ Face the Nation.

“We need to focus on the two problems we have, cost and access, not sort of scrap the entire healthcare system of the United States,” Senate Republican leader Mitch McConnell said on NBC’s Meet the Press.

A House committee’s version of the bill ran into trouble last week when a preliminary analysis of the plan by the nonpartisan Congressional Budget Office concluded the legislation would increase federal budget deficits by $239 billion over 10 years.

Orszag said that projection did not take into account cost-saving measures including curbing payments to doctors under the Medicare health program for the elderly.


“If you actually look at the CBO score that came out on Friday night -- and again, take off the table just maintaining current payment rates for physicians under Medicare -- that bill is deficit neutral,” he said on FOX.

Also, he said, “The single most important thing that’s missing from the legislation at this point is our proposal for an independent commission of doctors to help the policy-making process be more flexible, lead to higher quality and lower costs over time.”

While Orszag did not rule out any options to finance the overhaul, he said Obama believed there were “better ways of obtaining additional revenue” than the House Ways and Means Committee’s plan to raise $544 billion over 10 years largely by raising taxes on the wealthy.

Republicans charge that plan would kill many small businesses, but Orszag disputed said it would affect just a small percentage of small businesses.

Fiscally conservative Democrats also worry that higher taxes in the House bill will harm the economy, and if these 50-70 lawmakers ally with Republicans, it could scuttle the legislation in the House. The Senate Finance Committee, which is formulating the Senate version of the bill, is also trying to forge bipartisan consensus but finding it tough.

Additional reporting by Lesley Wroughton, Editing by Howard Goller