President Bush on Monday encouraged governors to support his proposal to change the tax code to help more people purchase private health insurance, but he did not address the governors' request for supplemental funds for SCHIP or additional funds for the program in his fiscal year 2008 budget proposal, the AP/San Francisco Chronicle reports. Bush met with the governors on Monday but did not comment directly on SCHIP (Tanner, AP/San Francisco Chronicle, 2/27). HHS Secretary Mike Leavitt said that he would work with Congress to find "a short-term solution" for the need for supplemental SCHIP funds but added that states could avoid deficits through more effective management of their programs. Leavitt said that, during his time as governor of Utah, "when we were out of an allotment, we just discontinued enrolling people until we had room." In addition, Leavitt said that some states could reduce SCHIP benefits.

Reaction
Ohio Gov. Ted Strickland (D) said, "In the meeting with the president and Secretary Leavitt, when questions were raised about children maybe having to be removed from the program or eligible children not being able to participate, we were told that that was basically a management problem." Vermont Gov. Jim Douglas (R) said that the budget proposal could result in a reduction in health insurance rates among children in the state. Douglas said that fewer than 4% of Vermont children lack health insurance, adding that "we don't want to lose ground." California Gov. Arnold Schwarzenegger (R) said that additional federal funds are necessary for his $12 billion health insurance proposal. Schwarzenegger, who met with Bush privately, did not comment on whether Bush agreed to help fund the proposal (Pear, New York Times, 2/27).

State Tobacco Taxes
In related news, more than a dozen states this year have considered increases to their tobacco taxes, in many cases to fund expansions of health insurance programs, USA Today reports. Four states -- Iowa, Maine, Maryland and Wisconsin -- have considered increases in their tobacco taxes of $1 or more. Wisconsin Gov. Jim Doyle (D) has proposed increasing the state cigarette tax by $1.25 per pack to expand health insurance to 185,000 of 250,000 uninsured residents. In Maryland, state House leaders have proposed doubling the state cigarette tax, currently at $1 per pack, to expand health insurance to almost one-third of the 780,000 uninsured residents. Increases in state tobacco taxes also can help reduce smoking rates. According to tobacco industry data, in the 19 states with cigarette taxes of $1 per pack or more, tobacco sales have decreased by 27% since 2000 (Wolf, USA Today, 2/27).