Opinion: A Health Insurance Detective Story

I’VE had a long career as a business journalist, beginning at Forbes and including eight years as the editor of Money, a personal finance magazine. But I’ve never faced a more confounding reporting challenge than the one I’m engaged in now: What will I pay next year for the pill that controls my blood cancer?

After making more than 70 phone calls to 16 organizations over the past few weeks, I’m still not totally sure what I will owe for my Revlimid, a derivative of thalidomide that is keeping my multiple myeloma in check. The drug is extremely expensive — about $11,000 retail for a four-week supply, $132,000 a year, $524 a pill. Time Warner, my former employer, has covered me for years under its Supplementary Medicare Program, a plan for retirees that included a special Writers Guild benefit capping my out-of-pocket prescription costs at $1,000 a year. That out-of-pocket limit is scheduled to expire on Jan. 1. So what will my Revlimid cost me next year?

The answers I got ranged from $20 a month to $17,000 a year. One of the first people I phoned said that no matter what I heard, I wouldn’t know the cost until I filed a claim in January. Seventy phone calls later, that may still be the most reliable thing anyone has told me.

Like around 47 million other Medicare beneficiaries, I have until this Friday, Dec. 7, when open enrollment ends, to choose my 2013 Medicare coverage, either through traditional Medicare or a private insurer, as well as my drug coverage — or I will risk all sorts of complications and potential late penalties.

But if a seasoned personal-finance journalist can’t get a straight answer to a simple question, what chance do most people have of picking the right health insurance option?

A study published in the journal Health Affairs in October estimated that a mere 5.2 percent of Medicare Part D beneficiaries chose the cheapest coverage that met their needs. All in all, consumers appear to be wasting roughly $11 billion a year on their Part D coverage, partly, I think, because they don’t get reliable answers to straightforward questions.

Here’s a snapshot of my surreal experience:

NOV. 7 A packet from Time Warner informs me that the company’s new 2013 Retiree Health Care Plan has “no out-of-pocket limit on your expenses.” But Erin, the person who answers at the company’s Benefits Service Center, tells me that the new plan will have “no practical effect” on me. What about the $1,000-a-year cap on drug costs? Is that really being eliminated? “Yes,” she says, “there’s no limit on out-of-pocket expenses in 2013.” I tell her I think that could have a major effect on me.

Next I talk to David at CVS/Caremark, Time Warner’s new drug insurance provider. He thinks my out-of-pocket cost for Revlimid next year will be $6,900. He says, “I know I’m scaring you.”

I call back Erin at Time Warner. She mentions something about $10,000 and says she’ll get an estimate for me in two business days.

NOV. 8 I phone Medicare. Jay says that if I switch to Medicare’s Part D prescription coverage, with a new provider, Revlimid’s cost will drive me into Medicare’s “catastrophic coverage.” I’d pay $2,819 the first month, and 5 percent of the cost of the drug thereafter — $563 a month or maybe $561. Anyway, roughly $9,000 for the year. Jay says AARP’s Part D plan may be a good option.

NOV. 9 Erin at Time Warner tells me that the company’s policy bundles United Healthcare medical coverage with CVS/Caremark’s drug coverage. I can’t accept the medical plan and cherry-pick prescription coverage elsewhere. It’s take it or leave it. Then she puts CVS’s Michele on the line to get me a Revlimid quote. Michele says Time Warner hasn’t transferred my insurance information. She can’t give me a quote without it. Erin says she will not call me with an update. I’ll have to call her.

My oncologist’s assistant steers me to Celgene, Revlimid’s manufacturer. Jennifer in “patient support” says premium assistance grants can cut the cost of Revlimid to $20 or $30 a month. She says, “You’re going to be O.K.” If my income is low enough to qualify for assistance.

NOV. 12 I try CVS again. Christine says my insurance records still have not been transferred, but she thinks my Revlimid might cost $17,000 a year.

Adriana at Medicare warns me that AARP and other Part D providers will require “prior authorization” to cover my Revlimid, so it’s probably best to stick with Time Warner no matter what the cost.

But Brooke at AARP insists that I don’t need prior authorization for my Revlimid, and so does her supervisor Brian — until he spots a footnote. Then he assures me that it will be easy to get prior authorization. All I need is a doctor’s note. My out-of-pocket cost for 2013: roughly $7,000.

NOV. 13 Linda at CVS says her company still doesn’t have my file, but from what she can see about Time Warner’s insurance plans my cost will be $60 a month — $720 for the year.

CVS assigns my case to Rebecca. She says she’s “sure all will be fine.” Well, “pretty sure.” She’s excited. She’s been with the company only a few months. This will be her first quote.

NOV. 14 Giddens at Time Warner puts in an “emergency update request” to get my files transferred to CVS.

Frank Lalli is an editorial consultant on retirement issues and a former senior executive editor at Time Warner’s Time Inc.

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Bits Blog: Study May Offer Insight Into Coca-Cola Breach

Spend enough time with cybersecurity experts and chances are you will hear some variation of this line: There are two types of companies in the United States, those that have been hacked and those that don’t yet know they’ve been hacked.

Government intelligence officials and cybersecurity specialists say hackers — predominantly from China — are siphoning gigabytes, if not terabytes, of data from companies in the United States every day. We count on much of this information to deliver the innovative products and services that will lead to new jobs and economic growth. The security software company McAfee estimates that in 2008 alone, companies around the world lost more than $1 trillion because of this sort of intellectual property theft.

“I’ve seen behind the curtain,” Shawn Henry, the Federal Bureau of Investigation.’s former top cyber agent, who recently joined the cybersecurity start-up CrowdStrike, told me in an interview in April. “I can’t go into the particulars because it’s classified, but the vast majority of companies have been breached.”

The problem is that such breaches rarely make headlines because companies fear what disclosure will mean for their stock price. Google was the first to try to change that mentality when, in 2010, it disclosed that it and 34 other companies, many based in Silicon Valley, had been attacked by Chinese hackers. Of those 34, only Intel and Adobe Systems came forward, and they provided few details.

Still, news of some breaches leak out. That was the case, most recently, with Coca-Cola. This month, Bloomberg News reported that Coca-Cola was breached by Chinese hackers in 2009 during a failed $2.4 billion takeover attempt of the China Huiyuan Juice Group. That attempted deal would have been the largest foreign acquisition of a Chinese company.

Now, a 2010 case study published by the Mandiant Corporation, a cybersecurity firm, may offer further details. The study, which does not mention Coca-Cola specifically, details a 2009 breach of a “Fortune 500 Manufacturer” that aligns almost perfectly with Bloomberg’s account of Coca-Cola’s breach.

According to the study:

In 2009, a U.S. based Fortune 500 manufacturing company initiated discussions to acquire a Chinese corporation. During the negotiations, APT [advanced persistent threat] attackers compromised computers belonging to the executives of the U.S.-based company, most likely in an effort to learn more details of the negotiations. Sensitive data left the company on a weekly basis during negotiations, potentially providing the Chinese company with visibility to pricing and negotiation strategies.

As Bloomberg reported, Mandiant’s study said the company gained knowledge of the breach only when law enforcement officials notified it of the intrusion. The study also details how hackers penetrated the company via a so-called spearphishing attack, in which the attackers sent e-mails to certain executives from a fake account ostensibly belonging to the chief executive.

According to Bloomberg, an e-mail containing the subject line: “Save power is save money! (from CEO)” was sent to the e-mail account of Bernhard Goepelt, Coca-Cola’s current general counsel. The e-mail contained a malicious link that, once clicked, downloaded malware that gave the attackers full access to Coca-Cola’s network.

Mandiant’s 2010 report said the e-mail “was crafted to look like it originated from a fellow employee and discussed a message from the CEO on conserving resources.”

Tal Be’ery, a senior Web researcher at Imperva, a data security firm, compared details of the Coca-Cola breach with Mandiant’s study and said the two accounts clearly referred to the same company. Executives at Mandiant and media officers at Coca-Cola did not return requests for comment.

If Mandiant’s study is, in fact, based on Coca-Cola, then it offers new insights into the breach. According to the study, once in, hackers used password-stealing software to gain access to other systems on the company’s network. They also used the compromised executive’s account to launch what is known as an SQL server attack, in which hackers exploit a software vulnerability and enter commands that cause databases to produce their contents.

But one of the most interesting aspects of the breach, according to Mandiant, was how well the attackers had concealed their tracks. According to Mandiant, hackers used so-called stub malware. This is an agile agent whose code can be tweaked by hackers to use it for various functions while leaving a small forensic footprint.

The one discrepancy between the Bloomberg and Mandiant accounts was why, ultimately, the company’s acquisition fell apart. According to Bloomberg, Coca-Cola’s takeover attempt of China Huiyuan Juice Group was thwarted because China’s Ministry of Commerce rejected it for antitrust reasons. Mandiant’s report offered a different take:

The intrusion had a significant impact on the victim organization. As a result of the compromise, the U.S. company terminated their acquisition plans. While it was not possible to determine all the data that had been lost, the victim company was not able to compete the acquisition and accomplish their business objectives.

Updated: In an e-mail, Kent J. Landers, a spokesman for Coca-Cola, said that the company does not comment on security matters, but said Coca-Cola did not complete its acquisition of China Huiyuan Juice Group ”as a result of the China Ministry of Commerce declining approval for the proposed transaction.”

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Tunnel Collapse Outside Tokyo Traps Motorists

Kyodo News, via Associated Press

A surveillance camera within the Sasago tunnel showed rescue workers at the scene of a collapse on Sunday.

TOKYO — At least seven people were feared dead after part of a highway tunnel collapsed Sunday in eastern Japan, trapping them in their vehicles and starting a fire that filled the tunnel with thick, black smoke.

Franck Robichon/European Pressphoto Agency

Fire fighters and rescue personnel gathered at the entrance to the Sasago tunnel, west of Tokyo.

Three vehicles appear to have been crushed under concrete that fell from the ceiling of the three-mile Sasago Tunnel near the city of Otsuki in Yamanashi Prefecture, about 50 miles west of Tokyo, the national government’s disaster management agency said. Agency and police officials said it remained unclear why the 150- to 200-foot section of eight-inch-thick concrete, weighing about 180 tons, suddenly fell.

A vehicle carrying six people caught fire, emitting heavy smoke that initially prevented firefighters from entering the tunnel. But even after putting out the blaze, rescuers had to temporarily suspend efforts to reach the trapped vehicles because of the danger of a further collapse, officials said.

They said rescue efforts resumed later in the day, though progress was slow because firefighters were still moving carefully.

Officials said a 28-year-old woman managed to flee from the vehicle that caught fire. She told firefighters that five other people remained trapped in her vehicle. It was unknown how many people were in the other vehicles besides the drivers, who were apparently also still trapped inside.

One of the other vehicles appeared to be a truck belonging to a food wholesaler, officials said. They said the driver called his company right after the accident to ask for help, but subsequent attempts to reach him by his cellphone failed.

The operator of the highway, Central Nippon Expressway, held a news conference to apologize for the accident. The police said they had opened an investigation into the cause of the collapse and whether professional negligence by the operator was a factor.

The accident closed a section of the Chuo Expressway, a vital transportation artery connecting Tokyo to western Japan. Such long tunnels — usually lined with smooth, white concrete — are a common sight on highways in this mountainous island nation.

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Most Americans Face Lower Tax Burden Than in the 80s

What Is Fair?:
Taxes are still a hot topic after the presidential election. But as a country that spends more than it collects in taxes, are we asking the right taxpayers to pay the right amounts?

BELLEVILLE, Ill. — Alan Hicks divides long days between the insurance business he started in the late 1970s and the barbecue restaurant he opened with his sons three years ago. He earned more than $250,000 last year and said taxes took more than 40 percent. What’s worse, in his view, is that others — the wealthy, hiding in loopholes; the poor, living on government benefits — are not paying their fair share.

“It feels like the harder we work, the more they take from us,” said Mr. Hicks, 55, as he waited for a meat truck one recent afternoon. “And it seems like there’s an awful lot of people in the United States who don’t pay any taxes.”

These are common sentiments in the eastern suburbs of St. Louis, a region of fading factory towns fringed by new subdivisions. Here, as across the country, people like Mr. Hicks are pained by the conviction that they are paying ever more to finance the expansion of government.

But in fact, most Americans in 2010 paid far less in total taxes — federal, state and local — than they would have paid 30 years ago. According to an analysis by The New York Times, the combination of all income taxes, sales taxes and property taxes took a smaller share of their income than it took from households with the same inflation-adjusted income in 1980.

Households earning more than $200,000 benefited from the largest percentage declines in total taxation as a share of income. Middle-income households benefited, too. More than 85 percent of households with earnings above $25,000 paid less in total taxes than comparable households in 1980.

Lower-income households, however, saved little or nothing. Many pay no federal income taxes, but they do pay a range of other levies, like federal payroll taxes, state sales taxes and local property taxes. Only about half of taxpaying households with incomes below $25,000 paid less in 2010.

The uneven decline is a result of two trends. Congress cut federal taxation at every income level over the last 30 years. State and local taxes, meanwhile, increased for most Americans. Those taxes generally take a larger share of income from those who make less, so the increases offset more and more of the federal savings at lower levels of income.

In a half-dozen states, including Connecticut, Florida and New Jersey, the increases were large enough to offset the federal savings for most households, not just the poorer ones.

Now an era of tax cuts may be reaching its end. The federal government depends increasingly on borrowed money to pay its bills, and many state and local governments are similarly confronting the reality that they are spending more money than they collect. In Washington, debates about tax cuts have yielded to debates about who should pay more.

President Obama campaigned for re-election on a promise to take a larger share of taxable income above roughly $250,000 a year. The White House is now negotiating with Congressional Republicans, who instead want to raise some money by reducing tax deductions. Federal spending cuts also are at issue.

If a deal is not struck by year’s end, a wide range of federal tax cuts passed since 2000 will expire and taxes will rise for roughly 90 percent of Americans, according to the independent Tax Policy Center. For lower-income households, taxation would spike well above 1980 levels. Upper-income households would lose some but not all of the benefits of tax cuts over the last three decades.

Public debate over taxes has typically focused on the federal income tax, but that now accounts for less than a third of the total tax revenues collected by federal, state and local governments. To analyze the total burden, The Times created a model, in consultation with experts, which estimated total tax bills for each taxpayer in each year from 1980, when the election of President Ronald Reagan opened an era of tax cutting, up to 2010, the most recent year for which relevant data is available.

The analysis shows that the overall burden of taxation declined as a share of income in the 1980s, rose to a new peak in the 1990s and fell again in the 2000s. Tax rates at most income levels were lower in 2010 than at any point during the 1980s.

Governments still collected the same share of total income in 2010 as in 1980 — 31 cents from every dollar — because people with higher incomes pay taxes at higher rates, and household incomes rose over the last three decades, particularly at the top.

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Ranbaxy, a Generic Drug Maker, Stops Making Cholesterol Pill

Ranbaxy Pharmaceuticals, the largest producer of the generic version of Lipitor, has halted production of the drug until it can figure out why glass particles may have ended up in pills that were distributed to the public, the Food and Drug Administration announced Thursday.

The agency said it had not received any reports of patients being harmed by the particles, which are about the size of a grain of sand. Earlier this month, Ranbaxy recalled more than 40 lots of the drug because of the glass contamination.

The company has declined to say where the drug was manufactured or why the problem occurred, but a spokeswoman for the F.D.A. said Thursday that the company would stop making the pill’s active ingredient, which is made in India, until the investigation is completed.

The contamination was the latest episode in a history of manufacturing lapses at Ranbaxy, which is a subsidiary of the Japanese pharmaceutical company Daiichi Sankyo. The company has been operating under a court-ordered consent decree since January, one that federal authorities have called “unprecedented in scope,” after they identified a host of manufacturing problems at the company’s plants in India and the United States, and concluded that Ranbaxy had submitted false data in drug applications to the F.D.A..

The decree prevents Ranbaxy from manufacturing drugs at its most troubled facilities until it can show it is meeting United States standards, although it was allowed to continue making products — including the generic version of Lipitor — at other plants.

The F.D.A. spokeswoman, Sarah Clark-Lynn, said the affected lots were not made at “the same facilities whose conduct gave rise to the consent decree.” Nonetheless, she said in an e-mail Monday, “the consent decree provides the F.D.A. with additional tools to address violations for other Ranbaxy facilities.”

A spokesman for Ranbaxy declined to comment beyond an informational statement on the company’s Web site.

Some drug manufacturing experts said Ranbaxy’s latest troubles highlight the disparities in oversight of plants in the United States versus those overseas. “I have pretty good faith in companies and plants that make drugs in this country because I know from my own experience that they try to do a good job,” said Prabir K. Basu, executive director of the National Institute for Pharmaceutical Technology and Education, who previously worked in manufacturing and global outsourcing for pharmaceutical companies, including Searle and Pharmacia. “But my confidence is not that high when we are getting products from outside the country.”

He pointed to studies that have shown the F.D.A. inspects foreign generic manufacturing plants about once every seven to 13 years, compared with once every two years for domestic manufacturers. A law passed over the summer will eventually require the F.D.A. to apply the same standards when inspecting all manufacturing plants, regardless of which country they’re in.

Allan Coukell, director of medical programs at the Pew Health Group and an expert on drug safety, said the new law would level what he described as an uneven playing field, but “it’s incumbent on F.D.A. to hire the staff and to make the shift to a risk-based inspection system.” Under the law, fees collected from generic manufacturers will help pay for more inspectors.

Mr. Basu said the law, called the Generic Drug User Fee Amendments of 2012 and known as Gdufa (Gah-doofuh) was a step in the right direction, but fixing the problem would require more than simply hiring more people. “This is a very difficult and complex system, and how do we ensure the integrity of this supply chain?” he said. “I don’t know how much Gdufa will help.”

Ranbaxy has held a significant share of the market for generic Lipitor, also known as atorvastatin, since it became one of the first companies to sell it after Pfizer lost patent protection for the top-selling drug last November; another company, Watson, sold a generic version that was authorized and manufactured by Pfizer. In October, Ranbaxy’s product accounted for 43 percent of prescriptions for atorvastatin, a widely used drug to lower cholesterol levels, according to an analysis by Michael Faerm, an analyst for Credit Suisse who used prescription data from the research firm IMS Health.

In its statement on Thursday, the F.D.A. said it did not expect a shortage of atorvastatin. Erin Fox, who tracks drug shortages as director of the Drug Information Service at the University of Utah, said drugs in pill form have long shelf lives and suppliers can keep large quantities in stock. Other generic manufacturers with approval to sell the drug include Apotex, Dr. Reddy’s Labs, Mylan, Sandoz, and Teva, according to the F.D.A. Web site.

Ranbaxy has posted a list of the recalled lots on its Web site, and has warned that patients should not stop taking the drug without guidance from their doctor. The lot numbers are found on the side of Ranbaxy pill bottles and the company advised patients to check with their pharmacist if customers received pills in a container dispensed by the pharmacy.

The agency said the potential for injury because of the contamination appeared to be low and “if any adverse events are experienced, they would be temporary.”

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Ranbaxy, a Generic Drug Maker, Stops Making Cholesterol Pill

Ranbaxy Pharmaceuticals, the largest producer of the generic version of Lipitor, has halted production of the drug until it can figure out why glass particles may have ended up in pills that were distributed to the public, the Food and Drug Administration announced Thursday.

The agency said it had not received any reports of patients being harmed by the particles, which are about the size of a grain of sand. Earlier this month, Ranbaxy recalled more than 40 lots of the drug because of the glass contamination.

The company has declined to say where the drug was manufactured or why the problem occurred, but a spokeswoman for the F.D.A. said Thursday that the company would stop making the pill’s active ingredient, which is made in India, until the investigation is completed.

The contamination was the latest episode in a history of manufacturing lapses at Ranbaxy, which is a subsidiary of the Japanese pharmaceutical company Daiichi Sankyo. The company has been operating under a court-ordered consent decree since January, one that federal authorities have called “unprecedented in scope,” after they identified a host of manufacturing problems at the company’s plants in India and the United States, and concluded that Ranbaxy had submitted false data in drug applications to the F.D.A..

The decree prevents Ranbaxy from manufacturing drugs at its most troubled facilities until it can show it is meeting United States standards, although it was allowed to continue making products — including the generic version of Lipitor — at other plants.

The F.D.A. spokeswoman, Sarah Clark-Lynn, said the affected lots were not made at “the same facilities whose conduct gave rise to the consent decree.” Nonetheless, she said in an e-mail Monday, “the consent decree provides the F.D.A. with additional tools to address violations for other Ranbaxy facilities.”

A spokesman for Ranbaxy declined to comment beyond an informational statement on the company’s Web site.

Some drug manufacturing experts said Ranbaxy’s latest troubles highlight the disparities in oversight of plants in the United States versus those overseas. “I have pretty good faith in companies and plants that make drugs in this country because I know from my own experience that they try to do a good job,” said Prabir K. Basu, executive director of the National Institute for Pharmaceutical Technology and Education, who previously worked in manufacturing and global outsourcing for pharmaceutical companies, including Searle and Pharmacia. “But my confidence is not that high when we are getting products from outside the country.”

He pointed to studies that have shown the F.D.A. inspects foreign generic manufacturing plants about once every seven to 13 years, compared with once every two years for domestic manufacturers. A law passed over the summer will eventually require the F.D.A. to apply the same standards when inspecting all manufacturing plants, regardless of which country they’re in.

Allan Coukell, director of medical programs at the Pew Health Group and an expert on drug safety, said the new law would level what he described as an uneven playing field, but “it’s incumbent on F.D.A. to hire the staff and to make the shift to a risk-based inspection system.” Under the law, fees collected from generic manufacturers will help pay for more inspectors.

Mr. Basu said the law, called the Generic Drug User Fee Amendments of 2012 and known as Gdufa (Gah-doofuh) was a step in the right direction, but fixing the problem would require more than simply hiring more people. “This is a very difficult and complex system, and how do we ensure the integrity of this supply chain?” he said. “I don’t know how much Gdufa will help.”

Ranbaxy has held a significant share of the market for generic Lipitor, also known as atorvastatin, since it became one of the first companies to sell it after Pfizer lost patent protection for the top-selling drug last November; another company, Watson, sold a generic version that was authorized and manufactured by Pfizer. In October, Ranbaxy’s product accounted for 43 percent of prescriptions for atorvastatin, a widely used drug to lower cholesterol levels, according to an analysis by Michael Faerm, an analyst for Credit Suisse who used prescription data from the research firm IMS Health.

In its statement on Thursday, the F.D.A. said it did not expect a shortage of atorvastatin. Erin Fox, who tracks drug shortages as director of the Drug Information Service at the University of Utah, said drugs in pill form have long shelf lives and suppliers can keep large quantities in stock. Other generic manufacturers with approval to sell the drug include Apotex, Dr. Reddy’s Labs, Mylan, Sandoz, and Teva, according to the F.D.A. Web site.

Ranbaxy has posted a list of the recalled lots on its Web site, and has warned that patients should not stop taking the drug without guidance from their doctor. The lot numbers are found on the side of Ranbaxy pill bottles and the company advised patients to check with their pharmacist if customers received pills in a container dispensed by the pharmacy.

The agency said the potential for injury because of the contamination appeared to be low and “if any adverse events are experienced, they would be temporary.”

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Syrian Internet Connections Cut for Second Day

BEIRUT, Lebanon — Activists in Syria reported on Friday that Internet connections were cut for a second successive day, fanning speculation among opponents of President Bashar al-Assad about the government’s intentions in coming days.

But some supporters of the rebels seeking Mr. Assad’s overthrow in the country’s bloody civil war said they could bypass the blackout on Internet servers by using satellite communications.

“Generally speaking, in Idlib we haven’t had an Internet connection or working landlines since the very beginning of the uprising,” said Ahmad Kadour, an activist in the northern province of Idlib. “Right now, the Internet is not working in any part of Syria, but most activists use satellite Internet connections and own satellite phones, so all is well. This operation won’t affect activists’ work much.”

However, a sniper for the Free Syrian Army calling himself Abu Bakr said via Skype that while rebels in Homs had a satellite Internet connection, they had no satellite phones, and were having trouble communicating with each other. “We’re relying on very basic hand-held devices that the regime could tap to communicate with our people in Jobar,” he said, referring to a neighborhood of Homs, “but we also need to be in touch with activists in other neighborhoods, and that’s the problem we’re facing.”

“We are under the the regime’s siege and airstrikes, and now the regime is tightening the siege and isolating us further,” he said. “But we’re trying to manage. What can we do? We won’t give up.”

Despite the Internet blackout on Thursday, people outside the country could still access Syrian government Web sites for much of the day because they were hosted in foreign countries, including the United States. After being contacted by The New York Times on Thursday, several host companies said they were taking down those sites, including those for the Syrian state news agency, SANA; the Syrian General Authority for Development; and the Ministry of Religious Affairs. All three were down on Friday.

On Thursday, Syria lost two major links with the outside world as the largest commercial airport in the capital canceled flights because of fighting nearby and the disappearance of Internet access, perhaps signaling an impending escalation by the government against the uprising.

The disruption at the airport, Damascus International — a crucial conduit for supplies, money and weapons for the government — was a measure of how intense the conflict has become around the capital in recent weeks. As security forces launched a major counteroffensive against rebels nearby, the government’s willingness to carry out military operations in the area suggested that it was feeling the pressure of rebel advances. Keeping the airport open helps the government project a sense of normalcy, and the interruption of service creates problems, activists said, because the large planes needed for supplies cannot land at smaller military airports. News reports from Syria on Friday offered confused accounts of the fighting, quoting activists as saying that the main road to the Damascus airport had reopened after intense clashes in the early hours, in which rebel forces destroyed government vehicles.

A reporter for The Associated Press said Damascus was largely quiet, although there were sounds of fighting in the suburbs — a report corroborated by a Reuters dispatch quoting Damascus residents as saying black smoke could be seen from the east and south of the city, with the constant sound of shelling.

Reuters also said government forces used airstrikes against rebel targets near the road leading to the airport, while a regional flight operator said civilian flights were not landing there on Friday. for a second day.

On Thursday, two companies that monitor Internet traffic, Arbor Networks and Akamai, released data demonstrating that the Internet went out across the country around 10 a.m. The Internet has been a strategic tool of the uprising and the government alike, allowing activists to organize and communicate but also exposing them to surveillance. Videos uploaded by both sides have made the conflict extraordinarily visible to the outside world.

Rebels have put the government under increasing pressure in recent weeks, taking oil fields in eastern Syria and a major air base near Aleppo, and demonstrating their growing ability to shoot down aircraft.

On Thursday, several airlines said they had halted flights to Damascus. An official at EgyptAir said it had indefinitely suspended flights because of the security situation there, though morning flights to the northern city of Aleppo were operating.

“They’ve turned it into a military airport lately,” said Abdul Rahman al-Barra, 27, an activist in the Damascus suburbs, adding that rebels had recently captured 40 pro-government militiamen in ambushes on the airport road. “Helicopters and warplanes land there, and Russian and Iranian experts travel through it.”

Speaking via Skype, which he said he was using with a satellite connection, Mr. Barra said fighters with the Free Syrian Army were battling government forces about a mile from the airport. “It’s a hit-and-run kind of battle,” he said. “The Free Syrian Army is using mortar shells without getting close to the airport, which the regime is firmly gripping now.”

Hania Mourtada and Anne Barnard reported from Beirut, Lebanon, and Hala Droubi from Dubai, United Arab Emirates. Kareem Fahim and Mai Ayyad contributed reporting from Cairo, Christine Hauser and Amy Chozick from New York, and Alan Cowell from London.

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IHT Rendezvous: Our Brussels Correspondents Answer Readers' Questions About the Euro, Europe and the Union

The news this week from besieged Europe was — relatively — good, sort of. Yields on Italian government bonds — the amount Italy has to pay investors to assume a piece of their debt — fell to the lowest levels in more than a year. The German parliament, the Bundestag, approved Germany’s latest contribution to bailout broke Greece. And though unemployment in the euro zone reached record heights, the head of the European Central Bank, Mario Draghi, predicted today that the euro zone’s economy would begin to recover in the latter part of next year.

But how long will it last? We have been here before, a lot. The market decides things are OK for the moment, before souring on Europe again. The spectacle of European leaders failing to agree on the outlines of a European Union budget came only last week — and that specter will rear its head again next year when those same leaders have to fashion a budget, and Greece will have to stay afloat, and Spain, Italy and Portugal will have to continue implementing structural reforms, and France may face a reckoning of its own, and Britain….Well, you understand.

We recently asked readers for their questions about the future of the European experiment. To bring some long-term clarity to all the short-term clutter, our Brussels correspondents, James Kanter and Andrew Higgins, have supplied the answers.

Judy W. from Cumberland, Maryland, asked, “Do you think the U.K. will end up leaving the E.U. and would be in their best interest to leave?”

Well, Judy, opinion polls in the Britain certainly suggest that hostility to the E.U. is mounting and nobody has ever lost votes in the U.K. by campaigning against Brussels. In fact, our colleague Stephen Castle reports today that the UKIP, “the party that wants Britain to quit the European Union, made spectacular gains in three by-elections held Thursday, increasing pressure on the Conservative Prime Minister, David Cameron, to take a tough line on Europe.”

But saying and doing are two different things. And should a referendum on Britain’s membership in the European Union be held, I doubt a majority would vote to actually pull out altogether. Britain would gain a financial windfall by leaving as it would no longer have to make annual contributions to the E.U. budget, but it would likely pay a very heavy economic price if it separates itself from the “single European market.” Potential losses will, I suspect, tilt opinion away from the exit, no matter how suspicious many Britons are of the “European project.” And, if a British withdrawal ever became an imminent possibility, the influential banking lobby in the City of London would pull out all the stops to try and make sure this doesn’t happen. It would want to make sure Britain is not absent from a decision-making process in Brussels that has a direct impact on global banking. Having financiers and hedge fund managers on its side will not endear the E.U. to the general public but would help mobilize money for a referendum campaign. (Andrew Higgins)

Abo in Paris and Judy W. got into a mini-debate over what countries contribute how much to Europe and how much they get back, leading to the question, “Does it make sense for countries to look at what they ‘put in’ and what they ‘get out’ as far as subsidies and benefits?”

The question goes to the heart of why the European Union summit aimed at agreeing to a seven-year budget for the Union collapsed last week. Net contributor countries like Britain, Germany and Sweden were at loggerheads with net recipient countries like Poland, Lithuania and Spain over the size of the budget — about €1 trillion between 2014 and 2020, or $1.3 trillion. Britain was fighting hard to maintain an annual rebate that was worth about €3.5 billion last year. Denmark was demanding a rebate, too. But that kind of haggling is mostly pointless, according to the European Commission, the Union’s policymaking arm.

The commission says none of what countries “put in” and “get out” truly reflects the advantages of being part of a single market of 500 million people. As an example, the commission says the benefits of E.U. membership to the British economy are many times higher than its annual net contribution of around €7 billion (after subtracting the rebate and after subtracting the money from the E.U. budget spent in Britain in 2011). The commission also says there are many hidden benefits to membership such as common rules on health, environment and consumer protection. Of course, the commission has a dog in this fight: Its refusal to trim its costs, including generous salaries and pensions, earned it a rebuke last week from British Prime Minister David Cameron, who said its officials continue to “exist as if in a parallel universe.” (James Kanter)

A popular question among readers — and markets — continues to be, “Wouldn’t the E.U. be better off if Greek were made to leave the euro?” A related question we received was: “Why doesn’t the E.U. draw up sensible plans for a country to leave the euro?”

To the second question, Prime Minister Mark Rutte of the Netherlands suggested today that a country should indeed be able to leave the euro and stay in the European Union.

Most observers assume that plans for Greece to leave the euro zone have been drawn up. But there are a host of reasons why such a plan hasn’t been put into effect. One is that the euro project is as much political as economic. For many European policymakers, it’s anathema that a country that is part of a flagship project for ever closer Union like the single currency could be shown the door. There also are fears that removing Greece from the euro area would actually do very little to solve some of the problems underlying the single currency. Once Greece goes market speculators could drive up the bond spreads of other countries like Portugal and Italy with economies that are a lot weaker than those of countries like Germany, which could still force the euro zone to unravel. (J.K.)

Judy W. also asked, “With the current impasse over the budget, is there any thought given to stopping E.U. enlargement since so many of the new countries are in need of large subsidies? Do you think Turkey will ever be admitted to the EU or will its candidacy just fade away?”

Turkish accession has been moving at a snail’s pace since formal negotiations began with the government in Ankara seven years ago. Currently the process is in a deep freeze partly because Cyprus holds the rotating E.U. presidency and wants a solution to the Turkish occupation of the northern third of the island. Yet Turkey, too, is looking beyond the E.U. as its economy booms.

That’s all the more understandable when you recall that Turkey first applied to become a member in 1987. Rather than Turkey, the countries most likely to be next are from the Western Balkans. Croatia already is set to join in mid-2013. Brussels officials say that refusing membership for candidates like Serbia would be foolish because that would add to the risks of instability in the region. Containing violence there could be costlier than Serbian membership.

One of the biggest concerns about enlargement is whether newer members from Eastern and Central Europe are sticking by the rules on pluralism, human rights and openness. Cases of corruption in Bulgaria and suggestions of an authoritarian drift in Hungary may be factors dampening the appetite for enlargement more than the costs of welcoming additional countries with lower levels of economic development. (J.K.)

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Medicare Is Faulted in Electronic Medical Records Conversion

The conversion to electronic medical records — a critical piece of the Obama administration’s plan for health care reform — is “vulnerable” to fraud and abuse because of the failure of Medicare officials to develop appropriate safeguards, according to a sharply critical report to be issued Thursday by federal investigators.

Mike Spencer/Wilmington Star-News, via Associated Press

Celeste Stephens, a nurse, leads a session on electronic records at New Hanover Regional Medical Center in Wilmington, N.C.

Centers for Medicare and Medicaid Services

Marilyn Tavenner, acting administrator for Medicare.

The use of electronic medical records has been central to the aim of overhauling health care in America. Advocates contend that electronic records systems will improve patient care and lower costs through better coordination of medical services, and the Obama administration is spending billions of dollars to encourage doctors and hospitals to switch to electronic records to track patient care.

But the report says Medicare, which is charged with managing the incentive program that encourages the adoption of electronic records, has failed to put in place adequate safeguards to ensure that information being provided by hospitals and doctors about their electronic records systems is accurate. To qualify for the incentive payments, doctors and hospitals must demonstrate that the systems lead to better patient care, meeting a so-called meaningful use standard by, for example, checking for harmful drug interactions.

Medicare “faces obstacles” in overseeing the electronic records incentive program “that leave the program vulnerable to paying incentives to professionals and hospitals that do not fully meet the meaningful use requirements,” the investigators concluded. The report was prepared by the Office of Inspector General for the Department of Health and Human Services, which oversees Medicare.

The investigators contrasted the looser management of the incentive program with the agency’s pledge to more closely monitor Medicare payments of medical claims. Medicare officials have indicated that the agency intends to move away from a “pay and chase” model, in which it tried to get back any money it has paid in error, to one in which it focuses on trying to avoid making unjustified payments in the first place.

Late Wednesday, a Medicare spokesman said in a statement: “Protecting taxpayer dollars is our top priority and we have implemented aggressive procedures to hold providers accountable. Making a false claim is a serious offense with serious consequences and we believe the overwhelming majority of doctors and hospitals take seriously their responsibility to honestly report their performance.”

The government’s investment in electronic records was authorized under the broader stimulus package passed in 2009. Medicare expects to spend nearly $7 billion over five years as a way of inducing doctors and hospitals to adopt and use electronic records. So far, the report said, the agency has paid 74, 317 health professionals and 1,333 hospitals. By attesting that they meet the criteria established under the program, a doctor can receive as much as $44,000 for adopting electronic records, while a hospital could be paid as much as $2 million in the first year of its adoption. The inspector general’s report follows earlier concerns among regulators and others over whether doctors and hospitals are using electronic records inappropriately to charge more for services, as reported by The New York Times last September, and is likely to fuel the debate over the government’s efforts to promote electronic records. Critics say the push for electronic records may be resulting in higher Medicare spending with little in the way of improvement in patients’ health. Thursday’s report did not address patient care.

Even those within the industry say the speed with which systems are being developed and adopted by hospitals and doctors has led to a lack of clarity over how the records should be used and concerns about their overall accuracy.

“We’ve gone from the horse and buggy to the Model T, and we don’t know the rules of the road. Now we’ve had a big car pileup,” said Lynne Thomas Gordon, the chief executive of the American Health Information Management Association, a trade group in Chicago. The association, which contends more study is needed to determine whether hospitals and doctors actually are abusing electronic records to increase their payments, says it supports more clarity.

Although there is little disagreement over the potential benefits of electronic records in reducing duplicative tests and avoiding medical errors, critics increasingly argue that the federal government has not devoted enough time or resources to making certain the money it is investing is being well spent.

House Republicans echoed these concerns in early October in a letter to Kathleen Sebelius, secretary of health and human services. Citing the Times article, they called for suspending the incentive program until concerns about standardization had been resolved. “The top House policy makers on health care are concerned that H.H.S. is squandering taxpayer dollars by asking little of providers in return for incentive payments,” said a statement issued at the same time by the Republicans, who are likely to seize on the latest inspector general report as further evidence of lax oversight. Republicans have said they will continue to monitor the program.

In her letter in response, which has not been made public, Ms. Sebelius dismissed the idea of suspending the incentive program, arguing that it “would be profoundly unfair to the hospitals and eligible professionals that have invested billions of dollars and devoted countless hours of work to purchase and install systems and educate staff.” She said Medicare was trying to determine whether electronic records had been used in any fraudulent billing but she insisted that the current efforts to certify the systems and address the concerns raised by the Republicans and others were adequate.

Read More..

Medicare Is Faulted in Electronic Medical Records Conversion

The conversion to electronic medical records — a critical piece of the Obama administration’s plan for health care reform — is “vulnerable” to fraud and abuse because of the failure of Medicare officials to develop appropriate safeguards, according to a sharply critical report to be issued Thursday by federal investigators.

Mike Spencer/Wilmington Star-News, via Associated Press

Celeste Stephens, a nurse, leads a session on electronic records at New Hanover Regional Medical Center in Wilmington, N.C.

Centers for Medicare and Medicaid Services

Marilyn Tavenner, acting administrator for Medicare.

The use of electronic medical records has been central to the aim of overhauling health care in America. Advocates contend that electronic records systems will improve patient care and lower costs through better coordination of medical services, and the Obama administration is spending billions of dollars to encourage doctors and hospitals to switch to electronic records to track patient care.

But the report says Medicare, which is charged with managing the incentive program that encourages the adoption of electronic records, has failed to put in place adequate safeguards to ensure that information being provided by hospitals and doctors about their electronic records systems is accurate. To qualify for the incentive payments, doctors and hospitals must demonstrate that the systems lead to better patient care, meeting a so-called meaningful use standard by, for example, checking for harmful drug interactions.

Medicare “faces obstacles” in overseeing the electronic records incentive program “that leave the program vulnerable to paying incentives to professionals and hospitals that do not fully meet the meaningful use requirements,” the investigators concluded. The report was prepared by the Office of Inspector General for the Department of Health and Human Services, which oversees Medicare.

The investigators contrasted the looser management of the incentive program with the agency’s pledge to more closely monitor Medicare payments of medical claims. Medicare officials have indicated that the agency intends to move away from a “pay and chase” model, in which it tried to get back any money it has paid in error, to one in which it focuses on trying to avoid making unjustified payments in the first place.

Late Wednesday, a Medicare spokesman said in a statement: “Protecting taxpayer dollars is our top priority and we have implemented aggressive procedures to hold providers accountable. Making a false claim is a serious offense with serious consequences and we believe the overwhelming majority of doctors and hospitals take seriously their responsibility to honestly report their performance.”

The government’s investment in electronic records was authorized under the broader stimulus package passed in 2009. Medicare expects to spend nearly $7 billion over five years as a way of inducing doctors and hospitals to adopt and use electronic records. So far, the report said, the agency has paid 74, 317 health professionals and 1,333 hospitals. By attesting that they meet the criteria established under the program, a doctor can receive as much as $44,000 for adopting electronic records, while a hospital could be paid as much as $2 million in the first year of its adoption. The inspector general’s report follows earlier concerns among regulators and others over whether doctors and hospitals are using electronic records inappropriately to charge more for services, as reported by The New York Times last September, and is likely to fuel the debate over the government’s efforts to promote electronic records. Critics say the push for electronic records may be resulting in higher Medicare spending with little in the way of improvement in patients’ health. Thursday’s report did not address patient care.

Even those within the industry say the speed with which systems are being developed and adopted by hospitals and doctors has led to a lack of clarity over how the records should be used and concerns about their overall accuracy.

“We’ve gone from the horse and buggy to the Model T, and we don’t know the rules of the road. Now we’ve had a big car pileup,” said Lynne Thomas Gordon, the chief executive of the American Health Information Management Association, a trade group in Chicago. The association, which contends more study is needed to determine whether hospitals and doctors actually are abusing electronic records to increase their payments, says it supports more clarity.

Although there is little disagreement over the potential benefits of electronic records in reducing duplicative tests and avoiding medical errors, critics increasingly argue that the federal government has not devoted enough time or resources to making certain the money it is investing is being well spent.

House Republicans echoed these concerns in early October in a letter to Kathleen Sebelius, secretary of health and human services. Citing the Times article, they called for suspending the incentive program until concerns about standardization had been resolved. “The top House policy makers on health care are concerned that H.H.S. is squandering taxpayer dollars by asking little of providers in return for incentive payments,” said a statement issued at the same time by the Republicans, who are likely to seize on the latest inspector general report as further evidence of lax oversight. Republicans have said they will continue to monitor the program.

In her letter in response, which has not been made public, Ms. Sebelius dismissed the idea of suspending the incentive program, arguing that it “would be profoundly unfair to the hospitals and eligible professionals that have invested billions of dollars and devoted countless hours of work to purchase and install systems and educate staff.” She said Medicare was trying to determine whether electronic records had been used in any fraudulent billing but she insisted that the current efforts to certify the systems and address the concerns raised by the Republicans and others were adequate.

Read More..