WASHINGTON - With a virtual civil war raging over parts of President Obama's health-care agenda, the smoke of battle has obscured a surprising fact: Democrats and Republicans actually agree on a bundle of proposals that could make medical insurance better for millions of Americans.

And with the loss of Sen. Edward M. Kennedy (D., Mass.) and his storied ability to eke out bipartisan compromises, lawmakers are eyeing those consensus proposals - including a ban on lifetime benefit caps and on denial of coverage because of preexisting conditions - as a possible fallback if Obama's more ambitious approach collapses.

In fact, while Kennedy devoted much of his career to seeking a comprehensive overhaul of health care, he also showed how much could be accomplished by passing incremental changes when grand plans failed.

He long ago concluded that his dream of a "single payer" government insurance system was a nonstarter politically, so he found piecemeal ways to expand medical coverage for children, workers who change jobs, and others.

In the current political climate, there are steep new obstacles to that kind of strategic retreat.

Insurance companies are poised to fight even harder against new policy mandates if they are not part of a broader overhaul of the payment system. And the mistrust between Republicans and Democrats makes it more difficult to find productive common ground, especially in the absence of a legislative craftsman such as Kennedy.

"Kennedy was exceptionally gifted at focusing on what was essential and could be built upon later as a way of compromise," said John Rother, legislative director of AARP, the senior citizens' lobby.

Nonetheless, in light of huge new deficit projections and growing criticism of Obama's approach, some lawmakers have warmed to the idea of scaling back their aspirations.

A key question for lawmakers when they return from an August recess dominated by criticism of Obama's plan is whether to shift their focus from massive overhaul to incremental changes.

"There is no reason we have to do it all now, but we do have to get it started," Sen. Joe Lieberman (I., Conn.), who is generally supportive of Obama, said in a recent television interview. "I'm afraid we've got to think about putting a lot of that off until the economy's out of recession."

Sen. Charles E. Grassley of Iowa, one of the few influential Republicans who has been open to compromise, said last week that he was less optimistic now after meeting his constituents this month.

"If other members of Congress are hearing what I'm hearing, they're saying, 'Slow it down. Do it a little more carefully. Make sure you know what you're doing. And maybe do it even a little more incrementally,' " he said in a conference call.

The insurance proposals with the broadest support would have a far more direct effect on the majority of Americans than the lightning-rod issues that have dominated debate, such as establishment of a public insurance option and requiring Medicare to pay for end-of-life counseling.

"Private insurance market reforms are quite possibly the least controversial of all the issues in health reform - and among the most important," said Drew Altman, president of the Henry J. Kaiser Family Foundation, a nonpartisan research group.

"Such reforms directly address some of the biggest insecurities people have about health care, particularly in the current economy," he said.

Altman cited a range of proposals that enjoy bipartisan support, including barring insurers from denying coverage to people with "pre-existing injuries and illnesses," from cutting off coverage when a policyholder gets sick, or from imposing a lifetime cap on benefits.

There are, however, practical problems with seeking incremental change in an area as complex and interconnected as health care - even on an idea as uncontroversial as guaranteeing coverage for preexisting conditions.

Insurance companies have long insisted that those limits are a legitimate way to deter people from getting insurance only after they get sick or injured. Industry spokesmen have said they are willing to drop such limits, but only if Congress requires everyone to have insurance.

A mandate for universal coverage would ease industry concerns that its costs would soar if people who were sick or likely to become sick got insurance while healthy people did not.

But if Congress were to enact a mandate that all individuals have insurance, it probably also would have to provide premium subsidies for lower- and middle-income people for it to be affordable and realistic. Then Congress would have to raise taxes or cut spending to pay for the subsidies, and the bill would start looking less incremental.

Said AARP's Rother: "You can't just do half the bill. It's an interconnected set of policies." Despite such objections, some lawmakers think ways might be found to make the incremental approach work.