Aug. 16 (Bloomberg) -- President Barack Obama said his opponents are being “dishonest” when they say that Democrats are pushing health-care legislation that would empower government panels to make life-or-death treatment decisions.

At a town hall meeting in Colorado yesterday, Obama recalled his grandmother’s death as he struck back at allegations that his proposals would create “death panels” to withdraw life-saving treatments from elderly patients.

“We can have an honest disagreement,” Obama said in Grand Junction, Colorado. “What you can’t do -- or you can, but you shouldn’t do -- is start saying things like, we want to set up death panels to pull the plug on grandma.”

Obama’s maternal grandmother, Madelyn Dunham, who helped raise him, died last November on the eve of her grandson’s election victory.

“I know what it’s like to watch somebody you love, who is aging, deteriorate and have to struggle with that,” Obama said. “We’ve got enough stuff to deal with without having these kinds of arguments.”

At his third town hall meeting in five days, Obama sought to change the tone and focus of the debate after opponents grabbed the spotlight at neighborhood meetings about proposed health-insurance legislation.

Before taking questions from an audience of about 1,800, Obama said insurance policies that put limits on total coverage or charge unreasonable fees can cause financial ruin for families.

‘Think Again’

“If you think this has nothing to do with you, think again,” Obama said. “If you or your spouse or your child get sick, and you hit that limit, suddenly it’s like you have no insurance at all.”

Obama said a health-care overhaul would keep insurers from imposing arbitrary limits on coverage and protect patients from unreasonable costs.

“Insurance companies will no longer be able to place an arbitrary cap on the amount of coverage you can receive or charge outrageous out-of-pocket expenses on top of your premiums,” he said.

Starting in Portsmouth, New Hampshire, on Aug. 11, Obama has said groups that profit from the current health-care system are misrepresenting his proposals. Obama hit the same themes on Aug. 14 in Belgrade, Montana, and yesterday in his weekly radio and Internet address.

‘Held Hostage’

Americans are being “held hostage” by insurers “that deny them coverage, or drop their coverage, or charge fees that they can’t afford for care they desperately need,” Obama said yesterday.

Proposals to overhaul U.S. health care have set off protests at forums across the U.S. during Congress’s August recess and face sagging support in public-opinion polls.

Among political independents, 35 percent say the demonstrations have made them more sympathetic to the protesters’ views, according to a USA Today/Gallup poll earlier this week.

Obama’s overall job-approval rating has slid. In a Gallup Inc. daily tracking poll, 55 percent of respondents say they approve of Obama’s job performance, down from 60 percent in mid- July.

So far, Obama has avoided angry audiences that have disrupted other forums. While taking questions, Obama has called on several people who are skeptical about his plans.

Yesterday, in response to a question about whether private insurers can compete against a government-operated insurance plan, Obama said taxpayer money wouldn’t be used to give the government a competitive advantage.

Public Option

“The notion that somehow just by having a public option you have the entire private marketplace destroyed is just not borne out by the facts,” Obama said.

The previous day, Marc Montgomery, an insurance agent in Helena, Montana, pressed Obama about whether the White House has a strategy to “vilify” insurance companies.

Obama said he’s not targeting health insurers and wants to “work with the existing system.”

Seeking to ease concerns among Americans that health care legislation would hurt the quality of their medical care, Obama is stressing ways his plans may help the 250 million Americans who have health insurance.

White House efforts to rouse public support may at least have helped limit the opposition’s growth. While 49 percent of Americans disapprove of Obama’s handling of health-care policy, versus 43 percent who approve, those numbers are virtually unchanged from a 50-44 percent split in mid-July, according to a Gallup survey released Aug. 12.

Expanding Coverage

Democrats are pushing plans to cover some of the 46 million uninsured Americans while cutting health-care costs that make up about one-sixth of the nation’s economy. Polls show that Americans are wary of estimates that the health-insurance proposals may cost the government $1 trillion over 10 years.

Obama and top congressional Democrats are pushing plans to offer the option of buying government-sponsored health insurance while requiring all Americans to get coverage.

Obama is traveling with his family on a trip that includes visits to Yellowstone National Park and Arizona’s Grand Canyon.

With first lady Michelle Obama and his daughters, Sasha and Malia, Obama yesterday stopped at Yellowstone’s Old Faithful geyser. “Oh that’s pretty good,” Obama said when the geyser shot water and steam into the air. “Look at that!” Obama spent about two hours fly fishing during his stop in Montana a day earlier.

To contact the reporters on this story: Julianna Goldman in Grand Junction, Colorado, at 4304 or jgoldman6@bloomberg.net; Nicholas Johnston in Washington at njohnston3@bloomberg.net.

Last Updated: August 16, 2009 00:01 EDT