Obama says House looks to back healthcare in July

President Barack Obama and Democratic leaders on Wednesday said they would like to steer a comprehensive overhaul of the U.S. healthcare system through the House of Representatives by the end of July.

That would put the legislation on course for a debate in both the House and Senate during the fall and possibly meet Obama's desire to sign a healthcare overhaul into law by the end of the year.

"We don't have any excuses. The stars are aligned," said Obama, who has devoted much of this week to his drive to spur momentum behind the healthcare legislation.

The Democratic-controlled Senate and the House of Representatives are working to pass bills through their respective chambers by their recess in early August.

That would give them time to work out their differences and meet Obama's deadline.

A partisan battle is likely on the costs.

Obama spoke after a White House meeting with House Speaker Nancy Pelosi and other influential Democrats who will take the lead on shaping the healthcare legislation.

Republicans say Obama's proposal to create a new public health plan to cover millions of uninsured Americans would undermine the private health care market and exacerbate already huge budget deficits.

"The House is working to pass a comprehensive healthcare reform bill by July 31, before they head out for the August recess, and that's the kind of urgency and determination that we need to achieve what I believe will be historic legislation," Obama said.

Pelosi, speaking before Obama, vowed healthcare legislation would be on the floor of the House by the end of July.

Ways to raise revenue to pay for the healthcare overhaul are being discussed in Washington.

The Senate Finance Committee, which is taking a lead in writing legislation to overhaul the $2.5 trillion U.S. healthcare system, is weighing spending cuts and tax increases to help cover the cost of expanding coverage to 46 million uninsured people.

Congress is looking closely at capping tax benefits for employer-provided healthcare, an option Obama and labor unions oppose. Currently employers can deduct the cost of the benefit and employees do not pay income taxes on it.

Michael Jacobson, executive director of the Center for Science in the Public Interest, suggested on Tuesday raising taxes on alcohol, soft drinks and foods high in fat and salt to encourage healthier eating and raise revenue.

Montana Senator Max Baucus, chairman of the Senate Finance Committee, told reporters on Capitol Hill that he thought the July goal was achievable.

"It's ambitious, aggressive but it's do-able," he said. "I think it's very possible, it's going to take a lot of work, a lot of cooperation."

"I think most people want to cooperate, most people know the stars are aligned, most know the train is leaving the station, and most know they better be on board," he said.

(Reporting by Steve Holland, Jeremy Pelofsky and Donna Smith, Editing by Sandra Maler and David Ljunggren)