Amid heated public debate, lawmakers could opt for a watered down version of US President Barack Obama's health care reform bill, experts said.

The White House signaled Sunday that it may drop the legislation's "public option" -- a government run plan for free health coverage -- sending Congressional Democrats reeling and setting the stage for a political dust up after the August recess.

Health and Human Services Secretary Kathleen Sebelius said the Obama administration did not consider the public option an "essential element" of the health care overhaul, despite Obama's previous contrary statements.

While members of Congress vowed to continue pushing for the option, experts said they may end up compromising with Republicans, who favor an alternative.

Advocates have trumpeted the public option as a solution to America's health care woes -- millions of Americans are uninsured -- while others have criticized it as a costly government intrusion into people's lives. And that sentiment could make it difficult for Obama to muster the votes needed to pass the legislation, experts said.

Henry Aaron, senior fellow at the Washington, D.C.-based Brookings Institution, said Democrats in Congress may ultimately seek middle ground. "I think they will moan and groan but unless they can show they've got the votes to pass it, they'll go along with it," he said. "Most elected officials would rather succeed through compromise" than accept flat-out defeat, he said.

Still it is possible the administration could make a third or fourth quarter comeback on the issue. "We'll find out when members come back in September," he said.

Dean Baker, co-director at the Washington, D.C.-based Center for Economic and Policy Research, said lawmakers are likely to pass a bill but may have to seek a happy medium on the public option.

"It's still better than a 50-50 chance that something will pass," he said. "Rather than go down in defeat (Obama) is looking to salvage what he can."

At present garnering the 60 votes to pass the legislation looks like an uphill climb, he said. And while the House could refuse to vote yes on the bill without the government insurance plan, "that's pretty unlikely at this point," he said.

Still some Democrats vowed to push for the public insurance plan, which former Democratic Party chair Howard Dean said is crucial to any health care legislation.

"I don't think it can pass without the public option," he said on CBS' This Morning, a TV talk show. "There are too many people who understand, including the president himself, the public option is absolutely linked to reform."

Congressional Democrats continued to argue for that plan, setting the stage for a row within Democratic Party ranks once the August recess ends.

"If the president thinks we're gonna get the votes without the public option, he's got another think coming," said Rep. Anthony Weiner, D-NY, to ABC News. "That won't pass the House."

The Congressman said some Democrats felt betrayed after supporting the president and faces harsh criticism from constituents.

Speaker of the House Nancy Pelosi on Monday echoed Democrats' concerns when speaking in favor of a public option, which she said would promote competition and broaden consumer choice.

"As the president stated in March, 'The thinking on the public option has been that it gives consumers more choices and it helps keep the private sector honest because there's some competition out there,'" she said. "We agree with the president that a public option will keep insurance companies honest and increase competition."

Some said a recent spate of nationwide town hall meetings in which constituents voiced their concerns to members of Congress --sometimes shouting them down -- was a partial reason for the White House's change of heart.

"My initial reaction was that it would work against them," Aaron said, but added that the reverse occurred.

Baker said: "The Townhallers derailed any serious discussion of the issue." But other factors played a role as well, he said.

"The press hasn't helped but Obama didn't stand up and press the case," he said. "He did a couple of times but he really had to go out and pound the pavement," he said, adding that the president should have ensured key supporters were blanking the nation to stir support.

The White House indicated that it might accept a health care cooperative system, although no one is sure what it would look like. Conservatives, who oppose the public option, criticized the idea, saying that the co-op is just another version of the original plan. Conservatives favor legislation that would take the federal government out of the equation, or at least minimize its role.

Nina Owcharenko, deputy director of the Center for Health Policy Studies at the Washington-D.C.-based Heritage Foundation, said reform should be state-based -- rural states face different problems than densely populated ones -- instead of federal.

Among other recommendations, she said Congress should provide tax relief for those who purchase their own coverage and help low-income individuals and families purchase private insurance. Financing the plan should not rely on tax increases or "unproven savings from Medicare and Medicaid that may never materialize," she said.

Using funds from those programs is one possibility Democrats have batted around to pay for the estimated 1 trillion dollars reform bill.

(Xinhua News Agency August 21, 2009)