Obama Signs SCHIP Law with Major Tobacco Tax Increase

Fulfilling a campaign promise, President Barack Obama signed the State Children’s Health Insurance Program (SCHIP) bill into law this week; the measure will expand healthcare coverage for children using funds from a 62-cent-per-pack increase in the federal cigarette tax.

The Detroit Free Press reported Feb. 4 that Obama approved the $74-billion SCHIP reauthorization legislation passed by the House of Representatives earlier in the day on a 290-135 vote. The Senate had previously approved the measure, which was vetoed twice last year by then-President George Bush.

The measure is expected to make an additional 4 million children eligible for SCHIP; the program currently covers about 7 million. In addition to increasing the federal cigarette tax to $1.01 per pack, the law will raise taxes on other cigarette products, generating estimated revenues of $71.4 billion over five years.