Washington (AFP) - Joe Biden's standing in the Democratic presidential nomination battle has slipped in Iowa against top rivals including Elizabeth Warren, the frontrunner in the early-voting state, who on Friday answered critics over how she will pay for her progressive policies.

As the 2020 protagonists clashed, one of the lower-polling Democratic candidates who started the contest with considerable promise, ex-congressman Beto O'Rourke, announced he was quitting the race.

O'Rourke's exit provided the latest dynamic in the crowded race to see who will challenge US President Donald Trump in November 2020.

Warren, who had been under fire for not explaining how she would pay for her universal health care proposal, took the risky political gamble of unveiling a $20.5 trillion Medicare for All plan.

How to pay for expanding and improving health care has become a flashpoint of the Democratic race, with Warren and her fellow progressive Senator Bernie Sanders pushing a sweeping transition to universal health care and the centrist Biden seeking to build on the existing Obamacare system.

Biden, the former vice president and longtime frontrunner in the national race, led for months in Iowa but that commanding lead has eroded since September.

He suddenly finds himself in fourth position in the heartland state that votes first in the Democratic nomination, according to The New York Times/Siena College poll out Friday, following the rise of Warren, a continued solid showing by Sanders, and a significant upswing by small-town mayor Pete Buttigieg.

The poll shows a tight top-tier race three months before February's Iowa caucuses, with Warren leading with 22 percent support, followed by Sanders at 19 percent, Buttigieg at 18 percent and Biden at 17 percent.

The figures are good news for 37-year-old Buttigieg, who has enjoyed a seven-point bump in Iowa since August, polling shows.

No other candidates in the crowded field come close in the Siena survey of 439 Iowa Democratic caucus goers.

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The poll reflects other warning signs for Biden. The 76-year-old is faring poorly with a younger demographic, with only two percent of respondents under age 45 saying they support Biden.

The figures highlight Biden's fade from his 28.5 percent support in Iowa six weeks ago, according to a RealClearPolitics poll aggregate.

Since then Biden has been caught up in the scandal forming the basis of the presidential impeachment investigation, as Trump stands accused of pressuring Ukraine to dig up dirt on Biden and his son who worked with a Ukrainian energy company.

Biden's support in New Hampshire, which votes second in the nomination race, has also dropped, polls show, from 34.5 percent in mid-July to 21 percent now, four points behind leader Warren.

- Math 'gymnastics' -

On her health care proposal, Warren unveiled a cost structure that she says would save American families $11 trillion in out-of-pocket expenses over the next decade.

Warren calls for Medicare, the US government health insurance program for the elderly and disabled, to be expanded to cover all Americans. It would replace private health insurance.

The plan would not require raising middle-class taxes "one penny," she said on her website.

Nearly half of the cost would come from having employers pay Medicare instead of private insurance companies.

The remainder would be financed by cuts to defense spending, new taxes on giant corporations and the wealthiest one percent of Americans, and crackdowns on tax evasion and fraud.

Biden's campaign criticized the plan as "mathematical gymnastics" and "double talk" that masks the difficulties of delivering Medicare for All without middle-class tax hikes.

Warren's plan highlights a major divide among Democrats over whether to strive for ambitious but expensive progressive policies, or make substantive changes that are more within reach.

Meanwhile 14 candidates gathered at a high-profile dinner Friday in Iowa to woo thousands of Democratic voters.

The Liberty and Justice fundraiser is seen as a launchpad for Democratic candidates seeking a breakout moment to propel them toward the Iowa caucus.

O'Rourke dropped out barely an hour before the Democratic gathering.

"Though this is the end of this campaign, we are right in the middle of this fight," he told supporters in Des Moines.

"I will do everything that I can to support the eventual nominee of this party, with everything that I've got."

The charismatic 47-year-old's campaign launch in March generated considerable enthusiasm.

But in subsequent months he failed to re-ignite the passion that had propelled him to rockstar status in the US Senate race that he narrowly lost last year in Republican-leaning Texas.