A separate measure was needed to reopen the government fully after 12 days of a partial shutdown that has resulted in furloughs for 350,000 federal workers and that administration officials warn could spread hardship if it remains in effect.
Politicians agreed passage of both was essential.
But Republicans demanded concessions that Democrats were unwilling to give - unless they could get something in return.
Officials in both parties said that Democrats had raised the possibility with Republicans of a long-term spending bill that included deficit savings that could replace some or all of the across-the-board spending cuts that began taking effect at the beginning of the year.
The political calculations were evident. Polls show all portions of the electorate except tea party supporters are increasingly displeased, and Republicans are bearing the brunt of their unhappiness.
"Perhaps he sees this as the best opportunity for him to win the House in 2014," Fleming said of the president. "It's very clear to us he does not now, and never had, any intentions of negotiating."
Reid was savage.
Republicans had begun seeking concessions on health care, he said, and now their No. 1 issue is "to divert attention from the fools they've made of themselves on Obamacare."
House Democrats lined up en masse to sign a legislative petition calling on Boehner to allow a vote on a bill to reopen the government, a step he has repeatedly refused to take.
In his Saturday address, Obama said, "Politics is a battle of ideas, but you advance those ideas through elections and legislation - not extortion."
Collins' suggested compromise had gained traction in recent days, before Reid told McConnell it was a nonstarter.
In a statement, the Maine Republican called the response unfortunate, and said talks on the plan involving senators of both parties "were constructive and give me hope that a bipartisan solution to reopen government and prevent default is within our reach."
It could have raised the debt limit through Jan. 31 and reopened the government for six months.
At the same time, it would have granted federal agencies flexibility in adjusting to the across the board cuts, and made two changes in the health care law.
One would have set new income verification conditions on individuals applying for federal subsidies for coverage; the other would have suspended a medical device tax for two years.