About four million more children would receive government-provided health care under a bill passed by the House today.
The bill goes to the Senate Thursday.
During his campaign, President-elect Obama promised to provide universal healthcare to all Americans who want it.
Obama said he hoped the Senate acts with the "same sense of urgency so that it can be one of the first measures I sign into law when I am president."
The plan would be paid for with an increase on cigarette taxes to pay the $32.3 billion cost of expanding the State Children's Health Insurance Program for the next 4½ years.
Obama said this policy is necessary.
"In this moment of crisis, ensuring that every child in America has access to affordable health care is not just good economic policy, but a moral obligation we hold as parents and citizens," he said.
Republicans Fear Spending
But Republicans complain the bill provides coverage for children of legal immigrants, even if they are not U.S citizens.
They also objected to the additional spending.
"The kids will have to pay through the nose for the things we are doing today," said Rep. Dan Burton, R-Ind. "We don't have the money to do all these things."
"Forty days in Iraq equals over 10 million children in America insured for one year," said House Speaker Nancy Pelosi. "We certainly can afford to do that."
SCHIP and Medicaid
SCHIP was created in 1997 to provide health coverage for children in families that earn too much to qualify for Medicaid but not enough to afford private insurance.
Current law requires a five-year waiting period before legal immigrants become eligible for coverage under Medicaid and SCHIP.
Supporters say expanding coverage would mean children could get treatment for acute conditions like asthma and diabetes so they would be less likely to need care in an emergency room.
Sources: The Associated Press