* Obama walks fine line to keep healthcare bill moving

* Torn between competing demands of coalition supporters

* Challenge to keep votes in line in Congress

WASHINGTON, Aug 19 (Reuters) - The Democratic Party feud over a government-run insurance plan has been another harsh reminder for President Barack Obama of how quickly his fragile healthcare reform coalition can splinter.

When Congress returns to work on his top domestic priority in September, Obama will face competing demands from liberal and conservative Democrats, leaders in the Senate and the House of Representatives, and Senate moderates from both parties -- all of whom could muster the votes to bury his plan.

"This was never going to be easy. There are going to be some very painful moments," said Bob Blendon, a health policy and political analyst at Harvard University.

Most analysts still expect a healthcare bill ultimately to make it through Congress. But its size and scope could be reduced and a long battle with Republicans could take a political toll on Obama, who entered the White House promising a new era of bipartisanship.

"There are a lot of hard votes and difficult negotiations ahead, and the path to the end is still not clear," Blendon said.

Obama got a preview of the challenges this week, when liberal Democrats threatened to withhold their support after the White House seemed to waffle on its commitment to a public insurance option that would compete with private insurers and offer more choices for consumers.

The liberal rebellion came three weeks after a group of conservative Democrats blocked consideration of healthcare legislation by a House panel until they won concessions from the administration.

Obama's courtship of Republicans also has failed, leaving Democrats pondering whether to go it alone.

Three Republicans and three Democrats from the Senate Finance Committee are still negotiating a compromise, but it is uncertain if it will attract any Republican votes -- even from the negotiators.

"When Obama moves right he loses the left, and what seems possible in the House doesn't seem possible in the Senate -- it's not clear how you get there from here," said Steven Schier, a political analyst at Carleton College in Minnesota.

Obama's push for a healthcare overhaul that reins in costs, constrains insurance companies and expands coverage to 46 million uninsured Americans has been assailed by critics on all sides and slowed by negotiations on Capitol Hill.

To ensure approval, he needs 218 votes in the House, where Democrats have 256 seats, and 60 votes in the Senate, where Democrats and their allies have exactly 60 seats -- enough to break any Republican effort to block the legislation through procedural tactics.

To reach the magic number in the House, Obama must walk a tightrope between more than 50 conservative "Blue Dog" Democrats, many from Republican-leaning districts, and more than 80 liberal members, most from safe Democratic seats where they rarely face a re-election challenge.

Liberals have demanded inclusion of a government-run insurance option and threatened to withhold support without it. Many Democratic conservatives have voiced concern about the cost, the public plan and the impact on small businesses.

PUBLIC OPTION IN HOUSE BILL

Three House committees have passed a healthcare measure that includes a strong public option, so for now Obama and supporters will have to find other areas to placate House conservatives.

The government-run insurance plan, designed to bolster competition and choice in the market, has been the focal point of critics who say the overhaul would amount to a government takeover of healthcare.

But some analysts said the battle over the public option, which a recent Congressional Budget Office report estimated would attract 10 million to 11 million people by 2019, was overblown.

"It's become a bigger symbolic issue than it is a substantive reality," said Drew Altman, president of the Kaiser Family Foundation, a non-partisan health policy group.

"When the Congress comes back the debate will refocus on the core issues rather than the hot-button issues ... how to pay for health reform and whether there can be even cosmetic bipartisan support," he said.

In the Senate, Democrat Kent Conrad, one of the so-called "Gang of Six" negotiating the Finance Committee bill, says Republican votes will be needed to reach the 60 mark.

Three moderates who vote with Democrats -- Ben Nelson, Mary Landrieu and Joe Lieberman -- have voiced doubts on the public option. Two other Democrats, Edward Kennedy and Robert Byrd, have been sick and their availability to vote is uncertain.

Three Republicans -- Charles Grassley, Mike Enzi, and Olympia Snowe -- are negotiating a compromise, but Grassley has said he is unsure if he will back the final product.

"The question now is at what point do Democrats say 'ok, we've given it our best shot, it's clear you don't want to deal, so we'll move ahead ourselves,'" said Richard Kirsch, campaign manager for Health Care for America Now, an umbrella organization for groups advocating reform.

Obama has given the Gang of Six until mid-September before he decides whether to press on without Republicans, a move that would make it an even bigger partisan issue in next year's congressional elections.

"Our preference is to work through this process and hopefully come out with a bill that has agreement among both parties," White House spokesman Robert Gibbs said.