President says he is sanguine about missed deadline but fears about $1tn plan continue to dog him

The US Congress will not meet next month’s deadline to pass sweeping healthcare reform as concerns about how to pay for the $1tn (£609m) plan continue to dog one of Barack Obama’s leading commitments.

The Senate majority leader, Harry Reid, said there will be no vote before Congress goes into recess in August as some senators complained that the speed of the reforms would produce flawed legislation.

Obama was sanguine, saying that he was not concerned so long as legislation on his plan for the government to provide health insurance was passed before the end of the year. “That’s OK. I just want people to keep on working. Just keep on working,” the president said.

But the delay is a blow because Democratic leaders had used the 7 August deadline to try to limit opposition within the party as various bills made their way through Congress.

The Republicans and sceptics will have the month-long recess to pick away at Obama’s plan by playing on voter concerns over cost and fears that the government will ration or restrict healthcare.

Obama was delivered a blow last week when the Congressional budget office director, Doug Elmendorf, said that the proposed plans could add up to $239bn to the deficit over the next 10 years.

That rang alarm bells among conservative Democrats who fear the reforms will result in higher taxes, which would anger voters.

A slew of adverts has hit US television screens from special interest groups attempting to portray Obama’s plan as likely to mean rationing of treatment and the authorities choosing people’s doctors.

Rick Scott, of Conservatives for Patients Rights, which has run adverts using the shortcomings of Britain’s NHS to campaign against the reforms, recently wrote a memo to supporters saying that delay would kill Obama’s plan.

“I am very confident, after meetings on (Capitol) Hill this week, that if Congress does not pass a healthcare bill with the public option before Labour Day [7 September], the public option is dead,” he wrote.

One of Obama’s problems is that without a detailed bill, it is difficult for him to persuade sceptical voters that they are not going to end up paying more or receiving less.

The president plans to meet Reid today and the Senate finance committee chairman, Max Baucus, in an effort to keep the legislation on track.

But the delay is clearly annoying the president. “It gets on my nerves. It frustrates me that we’d even be suggesting the status quo is the best we can do,” he said at a public meeting yesterday.