Congress set to vote on children's health bill

WASHINGTON (Reuters) - Moving quickly to try to give President-elect Barack Obama an early victory on an important healthcare issue, the U.S. House of Representatives is set to vote on Wednesday to expand a children's health program and increase cigarette taxes to pay for it.

The bill is similar to legislation twice vetoed by President George W. Bush who opposed raising tobacco taxes and argued that the bill, which at the time received broad bipartisan support, would push children into government-run health care instead of private plans.

The latest bill aims to provide healthcare coverage for more than 11 million children and pay for it by raising the cigarette tax to $1 a pack from the current 39 cents. Taxes on cigars and other tobacco products would rise as well.

The State Children's Health Insurance Plan currently covers 6.7 million children in low and moderate income families unable to afford private insurance.

The legislation would be an early victory for Obama who backs expansion of the program and who promised during his campaign for president to push for broad reform to make health coverage more available to all Americans.

The Senate is also moving fast to act on legislation. The Senate Finance Committee plans to draft its version of the bill on Thursday. That bill also would finance the expanded program through higher tobacco taxes.

"In these tough economic times, more and more parents can't afford health coverage for their kids," Senate Finance Committee Chairman Max Baucus, a Montana Democrat said in a statement.

"Millions of families felt abandoned in 2007 when the Children's Health Insurance Program got vetoed. But I'm committed to go the last mile now and finally see a CHIP expansion signed into law," he added.

(Editing by Eric Walsh)