The House of Representatives handed President Obama the first significant domestic victory of his presidency when it narrowly passed a sweeping reform Bill to provide healthcare to all Americans.

Mr Obama called the vote on Saturday “historic” and said he was absolutely confident that he would sign a health reform Bill by the end of the year. All eyes now turn to the next battleground — in the Senate — where passage of legislation is far from assured.

Democrats have for decades sought to provide universal health cover and, when the Bill was passed by 220 votes to 215 late on Saturday night, cheers erupted as Nancy Pelosi, the House Speaker, declared the victory.

The vote, during a rare Saturday session, marked the first time a chamber of Congress has voted to back such sweeping reform of the US health industry. Mrs Pelosi compared it to the passage of legislation creating a state pension system in 1935 and government health cover for the elderly and poor in 1965.

Mr Obama and his allies on Capitol Hill still face a tough battle for victory on his signature domestic issue. There is a significant risk that the debate will slide into 2010, a mid-term election year when vulnerable Democrats in conservative and moderate districts might fail to back a final Bill because of its huge cost.

Many are acutely aware of the Democratic losses last week in the Virginia and New Jersey gubernatorial races, when voters declared their misgivings about Mr Obama’s spending plans at a time of record deficits. On Saturday night 39 Democrats voted against the Bill. Only one Republican backed it.

The Senate must now come up with its own version of a health reform Bill and Harry Reid, the Democratic leader in that chamber, is under enormous pressure from the White House to get it through before the end of the year. Mr Reid is struggling to find the 60 votes he needs to overcome Republican blocking tactics despite his party’s Senate majority, Even if Mr Reid succeeds in getting legislation out of the Senate, his Bill — which will be markedly different from the liberal, 1,990-page, $1.2 trillion (£720 billion) behemoth passed by the House — will have to be reconciled into one piece of legislation in negotiations with the lower chamber, another difficult challenge.

Despite the obstacles ahead, the success of the House Bill was a powerful victory for Mr Obama and provi-ded strong political momentum behind his drive for health reform. The vote came after he visited Capitol Hill on Saturday afternoon to encourage wavering Democrats.

“It provides coverage for 96 per cent of Americans. It offers everyone, regardless of health or income, the peace of mind that comes from knowing they will have access to affordable healthcare when they need it,” said John Dingell, the 83-year-old Michigan Democrat who has introduced universal health insurance legislation in every Congress since his arrival in 1955. The huge package will transform large parts of the health industry, which currently accounts for a sixth of the US economy. Private insurers will no longer be able to deny cover to people with pre-existing conditions, or limit cover or drop it altogether when people become ill.

The Bill also contains a government-run health insurance option to provide competition to private insurers, something bitterly opposed by Republicans and an issue which triggered heated and sometimes violent protests during the summer.

Under the House Bill most indivi-duals will be required to obtain health insurance if it is not provided by their employer. All but the smallest companies will have to provide cover for their employees or face a fine as high as 8 per cent of their payroll. Overall the Bill would provide cover for an additional 36 million Americans, leaving 18 million without insurance by 2019, about a third of them illegal immigrants. The package will be paid for by increasing the tax on individuals earning more than $500,000 a year, and on families with a combined income of more than $1 million, by more than 5 per cent. Republicans remain almost unanimously opposed, critical of its huge cost and the tax increases needed to pay for it.