In the House, Democratic leaders had hoped to release an ambitious bill Friday that would achieve Obama's goals of holding down health care costs and extending insurance to the 50 million people who lack it. Insurers would have to cover all comers, employers would be required to offer insurance and individuals would be required to purchase it, with subsidies for the poor. The tax-writing Ways and Means Committee met throughout the day Thursday to try to finalize plans on how to pay for the plan, with an income surcharge on high-earners of some 3 percent or more emerging as the leading option.

But the move by the Blue Dogs scrambled the equation. It was unclear whether Democratic leaders would be able to satisfy the group's demands since in some cases they're far apart from draft language produced by the three House committees writing health legislation.

Also unclear was whether the setbacks would amount to anything more than a brief delay for a bill of enormous complexity and controversy.

Hoyer sought to minimize the day's developments.

"Let me make it very clear that everybody in that room thinks we ought to pass health care reform," the Maryland Democrat said after he and Pelosi met for more than two hours Thursday evening with Blue Dog members.

But Hoyer said, "There's still some additional work that needs to be done."

One conservative Democrat, Rep. Mike Ross, D-Ark., said he believes no House vote should take place until September.

That is well past a midsummer informal deadline set by Pelosi, D-Calif.

"I promised the president that we would have legislation out of the House before we went on an August break," she said earlier in the day. "That is still my goal."

Among the Blue Dogs' concerns is the shape of a new public insurance plan that would compete with private insurers. House leaders envision making payment rates to providers in the plan some 5 percent higher than Medicare payment rates. Blue Dogs say they can't support any link to Medicare rates, which they say pays well below market rates and varies unfairly around the country.

That puts House leaders in a tough spot since many liberal Democrats are insistent that a new public plan be linked to Medicare.

Associated Press writers David Espo and Ricardo Alonso-Zaldivar contributed to this report.