If you were one of the 100,000 people who signed up for InstLike, the Instagram app with the lame name that promises free likes, it's time to change your password. Users downloaded the app for the free likes and followers that it guaranteed, but after downloading, the app asked for their Instagram username and password — a red flag right there — and made them part of a giant, scammy botnet that followed and liked other accounts randomly. At its highest point, the app was in the top 25 "utility apps" in the Apple store, and it was among the highest-grossing utility apps after it convinced users to pay for "coins" to get more likes and followers. Symantec security researcher Satnam Narang told Mashable that InstLike took an innovative approach to scamming users, which is why so many fell for it. So don't feel too bad. But definitely delete that app. [Source]
Monday, November 25, 2013
Thursday, November 21, 2013
Wednesday, November 20, 2013
Online dating network hit with tens of millions of passwords hacks
Cupid Media
Cupid Media, a niche dating site based in Australia, admitted to a password breach in January.
The Australian-based Cupid Media, which owns more than 30 niche dating sites such as AsianDating.com and and BrazilianCupid.com, has disputed that number, but admitted to Krebs that a breach did occur in January 2013.
Why is this such a big deal? Because 42 million is one of the largest breaches to happen this year, made worse by the fact that the exposed passwords were stored as plain text.
Many people aren't vigilant about creating a different password for every site they log onto, which is why unencrypted passwords are so problematic.
"Even the most inept web companies usually use a cryptographic hash to represent user passwords," Chester Wisniewski, senior security adviser at Sophos, told NBC News in an email. "Not only does this allow crooks to potentially impersonate [users] elsewhere, it also allows unscrupulous employees at their own organization to log in to users' accounts without authorization."
In this case, according to information reviewed by Krebs, 34 million of the Cupid Media users registered with email addresses from Yahoo, Hotmail and Gmail. Another reason to worry: More than 1.9 million of the hacked accounts used the classic password 123456, while another 1.2 million used 111111. (The top non-numeric password was reportedly "iloveyou," followed by "lovely," "qwerty" and "password.")
While Cupid Media says it only has 34 million users, the report claimed that the discrepancy between that number and the 42 million breached accounts could be attributed to the fact that "many companies have a habit of storing data on customers who are no longer active."
Andrew Bolton, Cupid Media’s managing director, told Krebs that all of the company's affected users had been notified in January after the breach and that their passwords had been reset.
NBC News attempted to contact Cupid Media, but the company did not immediately respond.
The breach happened on the same server as the recent Adobe hack, which, according to the company, resulted in 38 million user mail addresses, encrypted passwords and password hints being compromised. Earlier this month, however, security firm LastPass claimed that information from more than 150 million user accounts had been exposed.
Despite the size of the Adobe breach, the Cupid Media hack is probably worse, claimed Wisniewski.
"The unencrypted nature of the sensitive information would arguably make this the worst breach of 2013," Wisniewski wrote. "While Adobe lost 150 million records, they had at least protected the user account information with encryption, albeit incorrectly."
Keith Wagstaff writes about technology for NBC News. He previously covered the tech beat for TIME's Techland and wrote about politics as a staff writer at TheWeek.com. You can follow him on Twitter at @kwagstaff and reach him by email at: Keith.Wagstaff@nbcuni.com
How an online rant can hurt your credit
A customer who wrote a negative review after a company failed to deliver a product is discovering painful consequences of a clause in a sales agreement.
By Money Staff
This post comes from Christine DiGangi at partner site Credit.com.
Consumers regularly complain online about a disappointing service or product, whether to get the attention of a company’s customer service or inform potential customers. Many people appreciate such reviews and find them helpful.
Merchants may not enjoy negative feedback, but what can they do about it?They may be able to fine you, according to a story reported by KUTV.
After Jen Palmer’s husband ordered Christmas gifts from Kleargear.com a few years ago, the items never arrived and the payment was canceled. The company never provided an explanation and Palmer’s attempts to connect with customer service failed, so she wrote a negative review on Ripoffreport.com.
Three years later, Kleargear.com demanded the post be taken down, or Palmer’s husband would face a fine for violating a non-disparagement clause in the site’s terms of sale. The clause says customers have 72 hours to remove the post or face a $3,500 fine, and unpaid fines will be reported to credit bureaus.
Because Kleargear.com says the fine is valid, the Palmers haven’t been able to successfully dispute the collections account.
Collections accounts stay on credit reports for about seven years, damaging credit scores and hurting consumers’ access to credit and lower interest rates.
Even if the Palmers decide to pay the debt, that won’t necessarily help with credit scores -- paid and unpaid collections affect your credit scores just the same (there is one exception -- VantageScore 3.0), but at least the debt is dealt with and prevents lawsuits for unpaid debt, collections calls and restricted access to loans.
If you're concerned about an unpaid debt affecting your credit, you should check your credit reports to be sure all accounts are listed accurately, and check your credit scores to assess your standing. You're entitled to your free annual credit reports from each of the three major credit reporting agencies.
Sunday, November 17, 2013
Thursday, November 14, 2013
Wednesday, November 13, 2013
Tuesday, November 12, 2013
Cool beans: New coffee machine roasts, grinds, then brews
Bonaverde
The final designs for the Bonaverde, after more than 150 prototypes and dozens of crowd-sourced designs.
It's true that in a coffee-loving city like Seattle or Portland, you may be lucky enough to get beans picked only a couple months back and roasted last week. But Bonaverde thinks the process can be shortened and simplified, resulting in more money for growers, fresher beans, and potentially better coffee. The Berlin-based coffee enthusiasts and engineers are hoping to raise $135,000 on Kickstarter to get the machine out the door.
The Bonaverde has a roaster built right in, and a single load is put in whenever you request a pot to be made, and roasted to your preference. Naturally, it's going to take longer than putting a "pod" into a machine in which all that needs to happen is hot water passing through the grinds — but if you can wait 15 minutes for your coffee, this will probably be a better brew.
Bonaverde
Bonaverde hopes to simplify the process of getting coffee from growers to consumers.
Will it end up saving you money? It's hard to say. But buying things in bulk is usually cheaper — and at $300 (the price for backers), the Bonaverde itself is cheaper than many home espresso machines. Of course, you can't make espresso or steam milk with it, but some people prefer drip to begin with.
Because it's Kickstarter, there's always the possibility it won't be funded, or that the whole project will self-destruct before the delivery date a year from now. But it appears to be a pretty professional operation and it's well on its way to the $135,000 mark as of this writing. There are a limited number available for backers, though, so if you're interested, better hop to it.
Devin Coldewey is a contributing writer for NBC News Digital. His personal website is coldewey.cc.
Rossen Reports
In a Rossen Report that aired on TODAY in February, a reformed iPhone thief said that stolen smartphones can fetch hundreds of dollars apiece on the black market.
"As horrible as it may sound, I tend to look for women — the older the better, generally," he said. "If I think that you can't catch me, I'm going for you."
The numbers are staggering: More than a million cellphones are stolen each year, more than a hundred every minute — and it gets violent. The thefts can happen fast — criminals snatch phones right out of people's hands, on train platforms and on busy streets — and in some cases, beat victims senseless.
On Tuesday, attorneys general from 31 states are demanding action, sending a letter to leading cellphone makers Samsung, Motorola and Microsoft demanding the companies "take all steps necessary to put consumer safety and security ahead of corporate profits..."
Do you want a scam, rip-off or issue investigated?
Law enforcement officials say there's technology that could curb celllphone thefts right now. New York's attorney general, Eric Schneiderman, is leading the effort to get companies to install anti-theft technology. He says that if all smartphones had a simple "kill switch," we'd all be safer.
Here's how it would work: If a thief steals your phone, you report it and built-in technology would deactivate the phone, locking the thieves out and making it useless no matter how many time it's wiped and rebooted. But officials say companies still haven't installed it as a standard feature.
"They don't have the financial incentive to do it," Schneiderman said. "In fact, they have the financial incentive not to do it."
Why? Often when people lose their phone, they just go back to the cell phone maker to buy another one. In fact, consumers spend $30 billion a year to replace lost and stolen phones. "That's a huge part of their business," Schneiderman said. "They're in business; it's all about money."
In response to the letter from the attorneys general, Microsoft said it has features to protect personal information, and that the company is working to address the issue. Motorola and Samsung declined to comment.
If the companies don't comply, the AGs say they will consider legal action.
In the meantime, there are a few ways to protect yourself.
Samsung has developed an app called "Lo-Jack" that can lock thieves out of your phone, but experts say it's not enough because you have to pay extra for it. Officials say Apple is doing a better job — if you have an iPhone, you can activate the "find my phone" setting for free in the latest operating system iOS7 (just go to your phone's "settings" icon, and then click the "iCloud" tab). When "find my phone" is turned on, no one can wipe and reactive your phone without first entering your Apple ID and password, making your phone useless to thieves.
Right now, you have to manually turn this feature on. Authorities want Apple to make it automatically on as standard in every iPhone.
Full statement from Microsoft:
“Windows Phone has built in capabilities enabling users to find, lock and even remotely delete data from a lost or stolen phone. We agree this is an industry-wide issue and are working closely with the CTIA and other organizations to address.”
Officials to cellphone makers: Install technology to curb thefts
Video: With more than a million cellphones stolen every year, attorneys general from 31 states are demanding that cellphone makers install technology that would make the devices useless to thieves. Jeff Rossen investigates.
"As horrible as it may sound, I tend to look for women — the older the better, generally," he said. "If I think that you can't catch me, I'm going for you."
The numbers are staggering: More than a million cellphones are stolen each year, more than a hundred every minute — and it gets violent. The thefts can happen fast — criminals snatch phones right out of people's hands, on train platforms and on busy streets — and in some cases, beat victims senseless.
On Tuesday, attorneys general from 31 states are demanding action, sending a letter to leading cellphone makers Samsung, Motorola and Microsoft demanding the companies "take all steps necessary to put consumer safety and security ahead of corporate profits..."
Do you want a scam, rip-off or issue investigated?
Law enforcement officials say there's technology that could curb celllphone thefts right now. New York's attorney general, Eric Schneiderman, is leading the effort to get companies to install anti-theft technology. He says that if all smartphones had a simple "kill switch," we'd all be safer.
Here's how it would work: If a thief steals your phone, you report it and built-in technology would deactivate the phone, locking the thieves out and making it useless no matter how many time it's wiped and rebooted. But officials say companies still haven't installed it as a standard feature.
"They don't have the financial incentive to do it," Schneiderman said. "In fact, they have the financial incentive not to do it."
Why? Often when people lose their phone, they just go back to the cell phone maker to buy another one. In fact, consumers spend $30 billion a year to replace lost and stolen phones. "That's a huge part of their business," Schneiderman said. "They're in business; it's all about money."
In response to the letter from the attorneys general, Microsoft said it has features to protect personal information, and that the company is working to address the issue. Motorola and Samsung declined to comment.
If the companies don't comply, the AGs say they will consider legal action.
In the meantime, there are a few ways to protect yourself.
Video: NBC’s Jeff Rossen provides a quick tutorial on how to protect your iPhone from being used by thieves.
Right now, you have to manually turn this feature on. Authorities want Apple to make it automatically on as standard in every iPhone.
Full statement from Microsoft:
“Windows Phone has built in capabilities enabling users to find, lock and even remotely delete data from a lost or stolen phone. We agree this is an industry-wide issue and are working closely with the CTIA and other organizations to address.”
Clinton: Government should 'honor' health care pledge
President Barack Obama should consider changes to his health care law to honor his pledge to allow consumers to keep their health care plans if they so desire, former President Bill Clinton said in an interview released Tuesday.
Clinton told the website OZY that the implementation of the Affordable Care Act has been, on balance, a good thing. "The big lesson is that we're better off with this law than without it," Clinton said. But he also lent some credence to GOP attacks on the law.
"I personally believe, even if it takes a change in the law, the president should honor the commitment the federal government made to those people and let them keep what they got," Clinton said.
The former president was referencing the pledge Obama made repeatedly during his sales job of the health care law that if individuals liked their current health care plan, they could keep it. In an interview with NBC News last week the president apologized for cancellations many individual policy holders are receiving and said his administration is looking at ways to change that part of the law.
Republicans have seized upon instances in which consumers have had their health plans canceled since the opening of the new insurance exchanges on Oct. 1, which effectively forces those consumers into new plans, either with their current insurers or the government exchanges. Those impacted are Americans who purchase their own insurance, accounting for about five percent of Americans. Those who receive their insurance through their employers are not impacted by that part of the law.
Moreover, the price tag for consumers forced to buy new plans has varied. For consumers eligible for subsidies under the law, the total cost of the new insurance plan might actually be lower, and they get broader coverage. For some consumers, though, the cost to them will be higher.
This Friday, the House is set to vote to approve legislation that would allow consumers to keep their health care plans if they so wished, even though those plans are regarded as substandard under current law.
Clinton told the website OZY that the implementation of the Affordable Care Act has been, on balance, a good thing. "The big lesson is that we're better off with this law than without it," Clinton said. But he also lent some credence to GOP attacks on the law.
"I personally believe, even if it takes a change in the law, the president should honor the commitment the federal government made to those people and let them keep what they got," Clinton said.
Lucas Jackson / Reuters file photo
Former President Bill Clinton laughs after doing an impression of artist Bono during the Clinton Global Initiative (CGI) in New York September 25, 2013.
Republicans have seized upon instances in which consumers have had their health plans canceled since the opening of the new insurance exchanges on Oct. 1, which effectively forces those consumers into new plans, either with their current insurers or the government exchanges. Those impacted are Americans who purchase their own insurance, accounting for about five percent of Americans. Those who receive their insurance through their employers are not impacted by that part of the law.
Moreover, the price tag for consumers forced to buy new plans has varied. For consumers eligible for subsidies under the law, the total cost of the new insurance plan might actually be lower, and they get broader coverage. For some consumers, though, the cost to them will be higher.
This Friday, the House is set to vote to approve legislation that would allow consumers to keep their health care plans if they so wished, even though those plans are regarded as substandard under current law.
Sunday, November 10, 2013
By Dr. Mary Fuller
Pet Poisons From A to ZIt can happen to even the best pet owners. You turn around for one second and the dog is into the chocolate that was sitting on the counter, or the cat has discovered the Easter lily you thought was safely out of the way.
How to Safeguard Your Pet
It's also a good idea to post the organization's phone number - 888-426-4435 - on your refrigerator for easy reference in the event of an emergency. The call center is staffed 24 hours a day, 365 days a year.
Pet Poisons From A to ZIt can happen to even the best pet owners. You turn around for one second and the dog is into the chocolate that was sitting on the counter, or the cat has discovered the Easter lily you thought was safely out of the way.
"We just don't realize how determined our pets are to eat the things they shouldn't," says Dr. Tina Wismer, DVM, medical director for the ASPCA Animal Poison Control Center.
Of the more than 180,000 cases that the organization handled in 2012, most of them involved pets who'd ingested human prescriptions. "Many children with ADHD don't want to take their medications, so they leave pills on their plates, where pets can get at them," Dr. Wismer says. "Even nonprescription medications, such as ibuprofen, can be a problem because many brands have a sweet coating, so it's like candy for dogs."
See Also: 10 Human Foods Dangerous to Pets
Vetstreet has compiled an A to Z list of some common pet poisons that should be on your radar. This list is not all-inclusive, so for more information on these and many other toxins, check out the ASPCA Animal Poison Control Center website and talk with your vet.
Pet Poisons From A to Z - Acetaminophen, which is found in Tylenol and other medications, can cause liver damage in dogs. Cats are even more sensitive: Ingestion of a single 325 mg tablet by a 10-pound cat can cause anemia and even be fatal. Toxicity Ranking: moderate to severe.
- Batteries can be toxic to both dogs and cats, leading to ulcers in the mouth, esophagus and stomach. Toxicity Ranking: moderate to severe.
- Chocolate can cause seizures and death in dogs and cats. Darker chocolate, such as unsweetened baker's chocolate, is more toxic than milk or white chocolate. Even cocoa bean mulch, when eaten in large quantities, can be a problem. Toxicity Ranking: moderate to severe.
- Detergents and fabric softener sheets can cause ulcers in the mouth, esophagus and stomach in dogs and cats. Toxicity Ranking: mild to moderate.
- Ethylene glycol is found in antifreeze, windshield de-icing agents and motor oils. Dogs and cats are attracted to its sweet taste, but as little as a teaspoon in cats or a tablespoon in dogs can cause kidney failure. Recently, antifreeze and engine coolant manufacturers have agreed to voluntarily add bittering agents to reduce the products' appeal to pets and children. Toxicity Ranking: severe to fatal.
- Fertilizers can contain poisonous amounts of nitrogen, phosphorus, potassium, iron, zinc, herbicides and pesticides. Keep dogs and cats away from treated lawns until they are dry. Check the product packaging, though, since some products must be rinsed into the lawn before it is safe to walk on. Toxicity Ranking: mild to moderate.
- Grapes, raisins and currants - even grape juice - in small amounts can cause kidney failure in dogs. Toxicity Ranking: moderate to severe.
- Household cleaners, such as bleach, drain cleaners, ammonia and toilet bowl cleaners, can cause gastrointestinal ulcers and other problems in dogs and cats. Toxicity Ranking: varies.
- Insecticides in flea and tick products can cause problems if not used according to labels. Insecticides that are meant for dogs can cause severe toxicity in cats, leading to signs such as vomiting, seizures and difficulty breathing. Products intended for treating the yard or house should not be used on pets. Toxicity Ranking: mild to severe.
- Jimson weed, also known as devil's trumpet, can cause restlessness, drunken walking and respiratory failure in dogs and cats. Toxicity Ranking: moderate.
- Kerosene, gasoline and tiki torch fluids can cause drooling, drunken walking and difficulty breathing in dogs and cats. If these products contain antifreeze, they are even more problematic. Toxicity Ranking: moderate to severe (potentially life threatening).
- Lilies - Easter, day, tiger, Japanese and Asiatic varieties - can cause kidney failure in cats. Lilies of the valley can cause heart rhythm problems and death in dogs and cats. Toxicity Ranking: moderate to severe.
- Mothballs, especially if they contain naphthalene, can be toxic to dogs and cats, resulting in vomiting, diarrhea, increased drinking and urination, and seizures. Toxicity Ranking: moderate to severe (potentially life threatening).
- Nonprescription medications, such as ibuprofen, can lead to severe ulcers and anemia, as well as liver and kidney failure in pets. Toxicity Ranking: moderate to severe (potentially life threatening).
- Onions, garlic, leeks and chives can be toxic in dogs and cats. When chewed or swallowed, these ingredients can cause anemia and gastrointestinal upset. Toxicity Ranking: mild to moderate.
- Prescription medications, such as antidepressants and ADHD and cardiac drugs, are commonly ingested by pets when pills are dropped on the floor or left on counters. Even a small dose can cause problems. Toxicity Ranking: varies.
- Queensland nuts, also known as macadamia nuts, can cause lethargy, vomiting and difficulty walking in dogs. Toxicity Ranking: mild to moderate.
- Rodenticides, such as mouse and rat poisons, can contain a number of different toxins, which have different effects on dogs and cats. Several common ingredients, like warfarin and coumarin, can cause blood clotting problems and hemorrhaging. Toxicity Ranking: mild to severe.
- Sago palms are one of a number of toxic plants for dogs and cats. Ingestion can lead to vomiting, diarrhea and seizures, as well as liver failure in dogs. Toxicity Ranking: severe.
- Tobacco can be toxic to both dogs and cats. Ingestion of nicotine in the tobacco plant or in cigarettes or patches can lead to vomiting, tremors, collapse and death. Toxicity Ranking: moderate to severe.
- Unbaked bread dough can expand in the stomach. If the stomach twists, cutting off the blood supply, emergency surgery is needed. The yeast in the dough can also produce alcohol, leading to seizures and respiratory failure. Toxicity Ranking: mild to severe.
- Veterinary prescriptions, such as arthritis medications, are often meat-flavored, which can be enticing to dogs. Ingestion of large quantities can result in stomach ulcers, liver failure or kidney failure. Toxicity Ranking: moderate to severe.
- Windshield wiper fluid can contain methanol or ethylene glycol. Ingestion of methanol can cause low blood sugar and drunken walking in dogs and cats. Toxicity Ranking: mild to moderate.
- Xylitol is a sugar-free sweetener commonly found in chewing gum, breath mints and toothpaste. In dogs, it can lead to dangerous drops in blood sugar and liver failure. Toxicity Ranking: mild to severe.
- Yard products, including snail and slug bait, herbicides and fertilizers, are never good for pets. Signs will vary by the ingredient. Toxicity Ranking: varies.
- Zinc toxicity can happen when dogs and cats eat metal or coins. Ingestion of even a single zinc penny can be fatal. Zinc can cause anemia, as well as liver, kidney or heart failure. Toxicity Ranking: moderate to severe.
How to Safeguard Your Pet
So how can you prevent your pet from an accidental poisoning? Start by visiting the ASPCA Animal Poison Control Center website to learn about other potential poisons, how to poison-proof your home and what to do if you suspect that your pet may have been poisoned.
It's also a good idea to post the organization's phone number - 888-426-4435 - on your refrigerator for easy reference in the event of an emergency. The call center is staffed 24 hours a day, 365 days a year.
"To poison-proof your home, don't keep medications where pets can get at them," Dr. Wismer says. "Keep cleaning products behind doors, and take your medication in another room, behind a locked door."
While dogs can be notorious for refusing to take their own medications, Dr. Wismer adds, "we sometimes say that the surest way to pill a dog is to drop one on the floor."
Few options for Obama to fix cancellations problem
That means the latest political problem engulfing Obama's health care overhaul may not be resolved quickly, cleanly or completely.
White House deputy spokesman Josh Earnest said Friday that the president has asked his team to look at administrative fixes to help people whose plans are being canceled as a result of new federal coverage rules. Obama, in an NBC interview Thursday, said "I am sorry" to people who are losing coverage and had relied on his assurances that if they liked their plan, they could keep it.
The focus appears to be on easing the impact for a specific group: people whose policies have been canceled and who don't qualify for tax credits to offset higher premiums. The administration has not settled on a particular fix and it's possible the final decision would apply to a broader group.
Still, a president can't just pick up the phone and order the Treasury to cut checks for people suffering from insurance premium sticker shock. Spending would have to be authorized by law.
Another obstacle: Most of the discontinued policies appear to have been issued after the law was enacted, according to insurers and independent experts. Legally, that means they would have never been eligible for cancellation protections offered by the statute. Its grandfather clause applies only to policies that were in effect when the law passed in 2010.
More than five weeks after open-enrollment season started for uninsured Americans, Obama's signature domestic policy achievement is still struggling. Persistent website problems appear to have kept most interested customers from signing up. Repairs are underway. Friday the administration said the website's income verification component will be offline for maintenance until Tuesday morning. An enrollment report expected next week is likely to reflect only paltry sign-ups.
Website woes have been eclipsed by the uproar over cancellation notices sent to millions of people who have individual plans that don't measure up to the benefits package and level of financial protection required by the law.
"It was clear from the beginning that there were going to be some winners and losers," said Timothy Jost, a law professor at Washington and Lee University in Virginia, who supports the health overhaul. "But the losers are calling reporters, and the winners can't get on the website."
In the House, a Republican-sponsored bill that would give insurers another year to sell individual policies that were in effect Jan. 1, 2013, is expected to get a floor vote late next week. In the Senate, Louisiana Democrat Mary Landrieu has introduced legislation that would require insurers to keep offering current individual plans. Democrats, who as a group have stood firmly behind the new law so far, may start to splinter if the uproar continues.
The legislation faces long odds to begin with, but it may not do the job even if it passes. The reason: States, not the federal government, regulate the individual insurance market. State insurance commissioners have already approved the plans that will be offered for next year. It may be too late to wind back to where things stood at the beginning of this year.
"It has taken the industry many months to rejigger their systems to comply with the law," said Bob Laszewski, a health care industry consultant. "The cancellation letters have already gone out. What are these guys supposed to do, go down to the post office and buy a million stamps?"
The insurance industry doesn't like the legislative route either. "We have some significant concerns with how that would work operationally," said Robert Zirkelbach, spokesman for the trade group America's Health Insurance Plans.
Behind the political and legal issues, a powerful economic logic is also at work.
Shifting people who already have individual coverage into the new health insurance markets under Obama's law would bring in customers already known to insurers, reducing overall financial risks for the insurance pool.
That's painful for those who end up paying higher premiums for upgraded policies. But it could save money for the taxpayers who are subsidizing the new coverage.
Compared with the uninsured, people with coverage are less likely to have a pent-up need for medical services. At one point, they were all prescreened for health problems.
A sizable share of the uninsured people expected to gain coverage under Obama's law have health problems that have kept them from getting coverage. They'll be the costly cases.
Obama sold the overhaul as a win all around. Uninsured Americans would get coverage and people who liked their insurance could keep it, he said. In hindsight, the president might have wanted to say that you could keep your plan as long as your insurer or your employer did not change it beyond limits prescribed by the government.
Meanwhile, Rep. Darrell Issa, R-Calif., chairman of the House Oversight Committee, said late Friday he had issued a subpoena to Todd Park, Obama's top adviser on technology, to appear before his committee next week. The White House has said Park is too busy trying to fix the health care website to appear.
Thursday, November 7, 2013
Wednesday, November 6, 2013
Top tech officer at health insurance agency resigns
Video: Speaking to 75 volunteers from the Dallas Area Interfaith Coalition at Temple Emanu-El, President Obama says that nothing "drives him more crazy" than the fact that people can't get to the affordable health care website.
Tony Trenkle, the CIO for the Centers for Medicare and Medicaid Services, "made a decision that he was going to move to the private sector," CMS spokeswoman Julie Bataille told reporters.
Members of Congress have been calling for someone to be fired to take responsibility for the embarrassing debut of the centerpiece of health reform -- many even calling for Health and Human Services Secretary Kathleen Sebelius to resign. Bataille would not say whether Trenkle had been asked to resign.
Sebelius told Congress earlier on Wednesday that a team of tech whizzes working through nights and weekends to fix the troubled health insurance marketplace website will be hard-pressed to finish repairs as promised by the end of November, and that as a result, not many people will have been able to sign up.
"We are not where we need to be," Sebelius told a hearing of the Senate Finance Committee. "It is a pretty aggressive schedule to get to the end of the punch list by the end of November," she said.
"I can tell you our early enrollment numbers will be very low."
She said "a couple of hundred functional fixes" had been identified.
The site was having trouble again on Wednesday, Bataille said. "The site is performing slowly. We know that some users are having difficulty logging in," she said.
But Sebelius again rejected the idea of shutting down the website to fix it for good, saying the site can be repaired while it's live.
"Delaying the Affordable Care Act wouldn't delay people's cancer or diabetes or Parkinson's," Sebelius said. "We want to save families from going bankrupt," she added. "Delay is not an option."
And, Sebelius said, the administration plans to reach out to people who may have tried to sign onto the site and stopped trying because they were frustrated. "We have a plan to re-invite people to the site," she said.
Later Wednesday, President Barack Obama visited Dallas to meet volunteers helping people to sign up and to sell his administration’s take on the law — which is that, despite problems with the site, people will get better insurance as a result of the 2010 Affordable Care Act.
"This is like having a really good product in the store and the registers aren't working and not enough parking spots, and no one can get in the door," Obama told a crowd at Temple Emanuel-El in Dallas.
The healthcare consulting company Avalere Health released an estimate Tuesday that suggested Texas alone could account for 9 percent of all the people signing up for insurance on the online exchange. That makes Texaqs an important target for the administration.
"Given delays in launching the federal website, the administration may focus year-end outreach efforts on large states like Texas. These states have significant numbers of uninsured individuals who can help bolster national enrollment statistics," said Caroline Pearson, vice president at Avalere Health.
And even as hostile Republicans in Congress grilled Sebelius and questioned whether health reform is working, Democrats chalked up a win with Terry McAuliffe's victory in Virginia. McAuliffe says one of his first priorities will be to embrace Obamacare and expand Medicaid in Virginia, one of the Republican-led states that has resisted doing so.
Obama pressed for Texas to do the same, but got a rude retort from the states Republican governor, Rick Perry. "Now he's coming to Texas in a desperate attempt to salvage his ill-conceived and unpopular program from a Titanic fate by preaching expansion of the same Medicaid system he himself admits is broken," Perry said in a statement.
"In Texas, where Medicaid already consumes a quarter of the state budget, we simply need the flexibility to implement fundamental, state-specific reforms to our Medicaid program, instead of a one-size-fits-all Washington mandate, before it bankrupts our state."
It wasn't much friendlier back in Washington.
"It is clear to me you are working as hard as you can to fix Healthcare.gov," Montana Sen. Max Baucus, the Democrat who chairs the committee, told Sebelius. But while he made it clear the hearing was a friendly one, Baucus expressed disappointment that Sebelius and her deputies did not foresee just how badly the new health insurance marketplace would falter.
Video: Sen. Orrin Hatch, R-Utah, levels heavy criticism toward U.S. Secretary of Health and Human Services Kathleen Sebelius Wednesday at a hearing on the rollout of healthcare.gov.
"Two separate reports, one from the General Accountability Office in June and another from the Department of Health and Human Services' Office of Inspector General in August, identified significant challenges months ahead of the Oct. 1 deadline," Hatch said. "Yet there is no indication that the warnings from these two independent, non-partisan watchdogs, were heeded by the government."
Kansas Sen. Pat Roberts, who had a decades-long relationship with Sebelius, repeated calls for her to resign. "I believe to protect the administration, you chose to ignore these warnings and as a result, you put the entire healthcare system, and one-sixth of the U.S. economy, in jeopardy," Roberts told Sebelius, a former Kansas governor.
"You have said Americans should hold you accountable which is why today, Madame Secretary, I repeat my request for you to resign."
Sebelius stayed unrattled under two and a half hours of questioning, deflecting repeated and often heated queries about the White House promise that people who like their insurance policies can keep them
"We know that lying to Congress is a crime, but unfortunately, lying to the American people is not," Texas Sen. John Cornyn, a Republican, said. "I'd just like to ask you a simple true-or-false question. Is that statement on the White House website true or is it false?"
"I think the statement is that..." Sebelius started to answer. But Cornyn testily interrupted. "Is it true or is it false, Madame Secretary?"
"The vast majority of Americans who are insured are in the employer market or in public plans or in veterans' plans, and the -- those plans have stayed in place and continue to offer benefits," Sebelius said. An estimated 15 percent of Americans don't have health insurance and the exchanges are meant to be a way to get them signed up for either private insurance or for Medicaid.
Sebelius said 11 million people who now buy their own insurance on the private market "will have stronger coverage". She noted that policies on the private market often change every year, and that a third of people with such policies hold them for six months or less, anyway.
Several Democrats came to the rescue. West Virginia Sen. Jay Rockefeller railed against what he called the "maniacal Republican attack machine" and said he was proud of the 2010 Affordable Care Act. "I think it's a magnificent work," Rockefeller said.
On Tuesday Marilyn Tavenner, administrator of the Centers for Medicare and Medicaid Services, which runs the website, told the Senate Health, Education, Labor and Pensions committee that her department would be able to provide numbers of how many people have been able to enroll in health insurance on the exchanges next week.
Tavenner says the site is being fixed and says it can handle 17,000 people a day now. She also said the administration has been planning all along for people to wait until the last minute to sign up —one big batch in December, and another batch in February and March.
Sebelius said the open enrollment period for Healthcare.gov is far longer than for most insurance policies. For employer-sponsored insurance, open enrollment, when people can change plans or sign up for new plans, is usually only two weeks long. The open enrollment for the first year of Healthcare.gov lasts six months, from Oct. 1 to March 31.
Video: Although more than 3 million Americans who buy their own health insurance have received cancellations letters, Kathleen Sebelius rejected bipartisan calls to postpone part of the healthcare law. NBC’s Peter Alexander reports.
Tuesday, November 5, 2013
The hidden marriage penalty in Obamacare
![Hidden Marriage Penalty in Obamacare: Childless couples and empty nesters pay more.: Hand holding wedding rings.]({"default":"http://newsbcpcol.stb.s-msn.com/amnews/i/cd/69b2eb98718e24877b6b0b58fd82/_h353_w628_m6_otrue_lfalse.jpg"})
REX Features: Brendan O'Sullivan
Hand holding wedding rings.
![The Atlantic]({"default":"http://newsbcpcol.stb.s-msn.com/amnews/i/eb/8a07f81213c7d48e146f287814d/_h17_w0_m6_otrue_lfalse.jpg"})
By Garance Franke-Ruta of The Atlantic Childless couples and empty nesters pay more. Much more.
The first time I heard Nona Willis Aronowitz talk about getting divorced to save money on health insurance I thought she couldn't really be serious. We were at Monte's, an old Italian place in South Brooklyn, having dinner with a group of New York women writers in late July.
"Don't do it!" I urged her, certain, having watched my friends over the years, that no matter how casually she or her husband might treat the piece of paper that says they are married, getting unhitched would inevitably change their relationship as profoundly as getting hitched in the first place.
But with the arrival of the Affordable Care Act's insurance exchanges, the question for Nona and her husband Aaron Cassara moved from the realm of casual conversation to a real financial conundrum. Aged 29 and 32, respectively, they were facing tough times for their professions, a wildly expensive city, and the scary prospect that both of them could shortly be uninsured. Right now Nona only has a COBRA plan—"which I can barely afford"—that ends January 1, she tells me. Her last staff job ended when the media outlet she was working for laid off its whole editorial team; she's been a full-time freelancer since. Aaron, a filmmaker who works part-time and also freelances, has been uninsured since her layoff, because it would be too expensive to have him on COBRA too.
Related: Obama promises complicate rollout
Any married couple that earns more than 400 percent of the federal poverty level of $62,040 for a family of two earns too much for subsidies under Obamacare. "If you're over 400 percent of poverty, you're never eligible for premium" support, explains Gary Claxton, director of the Health Care Marketplace Project at the Kaiser Family Foundation.
But if that same couple lived together unmarried, they could earn up to $45,960 each—$91,920 total—and still be eligible for subsidies through the exchanges in New York state, where insurance is comparatively expensive and the state exchange was set up in such a way as to not provide lower rates for younger people. (Subsidy eligibility is calculated using a complicated formula involving income in relation to the poverty line, family size, and the price of plans offered through a state's marketplace.)
Nona and Aaron's 2012 income was higher than the 400 percent mark, but not by much. In New York City, that still doesn't take you very far for two people. If their most recent months of income are in the same range, they will get no help at all with buying insurance through the exchanges if and when they apply, according to the Kaiser Family Foundation and eHealth subsidy calculators. Premiums for the two for silver-level plans came in at $9,248 for the year.
But if they applied as unmarried individuals with something like their 2012 income, one of them would get at least $3,964 in subsidies toward the purchase of a plan, or possibly even be eligible for Medicaid, thanks to their uneven individual earnings that year. And if they fall below the 400 percent threshold, which Nona says they might this year, they could get substantial subsidies as a couple that are still worth less than what they'd be eligible for as individuals. These gaps are the marriage penalty.
Married people who are uninsured make up just a small fraction of the uninsured, for obvious reasons: It is easier to be insured if you have two potential pathways of getting there.Only 15.4 percent of married people were uninsured 2012, according to research from the Kaiser Family Foundation; the uninsurance rate for "single adults living together" was more than twice as high—33.4 percent.
That may be one reason the Obamacare subsides are more generous to single people and one- or two-parent families with children in the house than to couples who lack children. They were designed to help single moms and struggling middle-class families with children, not married creative-class millennials in pricey cities who have not yet settled into well-paid work, or barring that, work for a single employer.
Health insurance isn't the only place where there's a marriage penalty. The federal income tax also hits married couples with similar earnings harder than couples with one main breadwinner.
"In the tax code, you have a different set of tax rates for married couples that mitigates the marriage penalty to some degree," says Robert Rector, a senior research fellow at the Heritage Foundation who has been writing about the marriage penalty in health reform since 2010. Under Obamacare, however, there are "dramatic" penalties that are "substantial—particularly with couples in the upper age range," he says.
"What you are doing is saying ... you have to pay a penalty of multiple hundreds of dollars—a substantial portion of your income—to stay married," Rector says. "It's saying society is basically hostile to the institution of marriage."
Experts on the impact of marriage penalties were skeptical that many couples would consider divorce over insurance rates. Still, there is some data to suggest that marriage penalties embedded in government programs can discourage marriage among those who are benefiting from programs that favor the unmarried.
"The received wisdom in public finance is that marriage per se can be financially discouraged if both members of a couple have decent earnings potential and would face a higher combined tax rate as a married couple than as a pair of singletons," explains Gary Burtless, a senior fellow at the Brookings Institution. "At the lower end of the income scale, if the combined earnings potential of the couple is not very promising, marriage might prevent the mom and kids from receiving as much government assistance as they can receive if the adult couple remains unmarried."
There's no data yet on the potential size of the population potentially affected by such concerns under the Affordable Care Act, but Medicaid and other means-tested programs "already created that kind of potential marriage penalty," he notes. At least half of the newly insured under ACA will be insured under Medicaid.
The great irony, Nona explains, is "we wouldn't be married if it weren't for a situation that happened in 2009 where he needed health insurance."
Despite its administrative beginnings, their City Hall marriage has lasted so far. Aaron was on Nona's insurance at first; later, when their job arrangements changed, she was on his. Now Nona is looking to land a full-time staff job, in hopes of once again having an employer-based plan that Aaron, too, can join.
"I guarantee you that in six months I will either be divorced or I will have a full-time job," she says.
Monday, November 4, 2013
Sunday, November 3, 2013
Romney: Obama's 'dishonesty' on health care puts second term in peril
Appearing on NBC’s Meet the Press, Romney said Obama’s handling of Obamacare’s promises “has undermined the foundation of his second term – I think it is rotting it away.”
He added that what “has really undermined the president's credibility in the hearts of the American people is that he went out, as a centerpiece of his campaign and as a centerpiece of Obamacare over the last several years, saying time and time again that fundamental to his plan was the right people would have to keep their insurance plan, and he knew that was not the case....”
He said “had the president been truthful and told the American people that millions would lose their insurance and millions more would see their premiums skyrocket… there would have been such a hue and cry against it, (that) it would not have passed.”
Romney said even though he’d signed into law when he was governor of Massachusetts a health insurance overhaul which Obamacare resembles, it was an error to design a “one-size-fits-all” national health insurance mandate as Obama did.
Former Massachusetts Gov. Mitt Romney visits Meet the Press to analyze the differences between his state's public health care program and the Affordable Care Act.
He said health insurance is more expensive in Massachusetts than in any other state and that “Texas and Minnesota and Montana” are not necessarily going to want to adopt such a costly plan.
The enrollment process for uninsured people under the Affordable Care Act has been plagued by software and data entry problems which led Health and Human Services Secretary Kathleen Sebelius to offer an apology to a House committee in testimony last week.
Sebelius called the enrollment software problems a “debacle” and “a miserably frustrating experience for way too many Americans.”
But in the past week the software issue has been overshadowed by the reports of thousands of Americans being told by their insurance companies that their policies can no longer cover them since they’re not in compliance with the benefits package defined by the Affordable Care Act.
Obama’s repeated promises in 2009 and 2010 -- that if a person liked the coverage he had, he could keep it -- have proven to be false.
Responding to Romney’s charges, Democratic Gov. Deval Patrick of Massachusetts, said for people who are losing their current health insurance coverage, Patrick said in many cases that coverage was flawed to begin with.
“If you have the kind of health care that disappears when you need it most, the Affordable Care Act says that has to end,” Patrick said.
On ABC’s This Week, Obama advisor Dan Pfeiffer discussed Obama’s promise that “if you like your plan, you can keep it,” by explaining that “if your plan has been downgraded or canceled, you can't” keep it.
But he argued, if Obama were to allow people “to have those plans be downgraded, or insurance companies to keep selling barebones plans… he'd be violating even more important promise to the American people, that everyone would have a guarantee to access of quality affordable health insurance.”
He said the plans that are now being discontinued “were cut-rate plans that didn't cover hospitalization, doctor's visits” and therefore people will be better off being covered by a more costly and more inclusive plans.
Pfeiffer said that under Obamacare, in the individual market for insurance, 50 percent of the uninsured “are going to be able to get access to tax subsidies to make their plans cheaper. And most of them will get a better plan for less for the same or less.”
Addressing the flaws in the Healthcare.gov site, Patrick said, “The website is imperfect. That’ll get fixed. I’m confident of that.” He added, “If the website is permanently flawed, we’ve got a serious problem,” but Patrick again said the software will be fixed.
“The obvious benefit of the website is to be able to compare plans, to shop, because as you shop, you save, and that’s why it’s urgent that the president get it fixed,” the Massachusetts governor said.
“What this whole situation has produced is actually a favor for the White House and for the president,” Patrick contended. “I and many others have been saying the president needs to be out talking about the fundamental good that the Affordable Care Act does for people. And this is provoking him to do so – and I think that’s a great thing.”
Another provision of the Affordable Care Act was in the news Friday as the U.S. Court of Appeals for the District of Columbia Circuit ruled that a small family-owned business may sue to assert the owners’ religious objections to the Obamacare requirement that employer-provided insurance pay for Food and Drug Administration-approved contraceptive methods, and sterilization procedures.
The ruling temporarily barred the Obama administration from enforcing the birth control mandate.
That case and a number of related lawsuits in other federal appeals courts are likely to be decided by the Supreme Court.
In his Meet the Press interview, when asked about potential GOP presidential contenders for 2016, Romney spoke highly of New Jersey Gov. Chris Christie, who seems headed for re-election on Tuesday. “He’s a very popular governor in a very blue state – that’s the kind of popularity and the kind of track record that the Republican Party needs if we’re going to take back the White House.”
Romney also praised his 2012 running mate, Rep. Paul Ryan of Wisconsin, as well as former Florida Gov. Jeb Bush and Sen. Marco Rubio of Florida.
But he omitted Sen. Ted Cruz of Texas from his impromptu list of 2016 GOP hopefuls. Asked about that omission, Romney said, “I’m not going to disqualify anybody but I think I’ve indicated some of the names I think are most effective in becoming elected….”
Saturday, November 2, 2013
Sticker shock often follows insurance cancellation
![Obamacare sticker shock: Louis Peters fills out papers at the Henry J. Austin Health Center in Trenton, N.J., to sign up for new health insurance plans: Louis Peters fills out papers at the Henry J. Austin Health Center in Trenton, N.J., to sign up for new health insurance plans.]({"default":"http://newsbcpcol.stb.s-msn.com/amnews/i/36/2dacc625cfea36c6f38689efcac1/_h353_w628_m6_otrue_lfalse.jpg"})
AP Photo: Mel Evans, File
Louis Peters fills out papers at the Henry J. Austin Health Center in Trenton, N.J., to sign up for new health insurance plans.
![AP]({"default":"http://newsbcpcol.stb.s-msn.com/amnews/i/e3/12e7ff08bf55a6d7449b766b4e23c/_h17_w0_m6_otrue_lfalse.jpg"}){kind=small}
By Kelli Kennedy of Associated Press
Millions of people are receiving notices that their health insurance policies are being discontinued, forcing them to pay more for Affordable Care Act coverage.
MIAMI — Dean Griffin liked the health insurance he purchased for himself and his wife three years ago and thought he'd be able to keep the plan even after the federal Affordable Care Act took effect.
But the 64-year-old recently received a letter notifying him the plan was being canceled because it didn't cover certain benefits required under the law.
The Griffins, who live near Philadelphia, pay $770 monthly for their soon-to-be-terminated health care plan with a $2,500 deductible. The cheapest plan they found on their state insurance exchange was a so-called bronze plan charging a $1,275 monthly premium with deductibles totaling $12,700. It covers only providers in Pennsylvania, so the couple, who live near Delaware, won't be able to see doctors they've used for more than a decade.
"We're buying insurance that we will never use and can't possibly ever benefit from. We're basically passing on a benefit to other people who are not otherwise able to buy basic insurance," said Griffin, who is retired from running an information technology company.
The Griffins are among millions of people nationwide who buy individual insurance policies and are receiving notices that those policies are being discontinued because they don't meet the higher benefit requirements of the new law.
They can buy different policies directly from insurers for 2014 or sign up for plans on state insurance exchanges. While lower-income people could see lower costs because of government subsidies, many in the middle class may get rude awakenings when they access the websites and realize they'll have to pay significantly more.
Those not eligible for subsidies generally receive more comprehensive coverage than they had under their soon-to-be-canceled policies, but they'll have to pay a lot more.
Because of the higher cost, the Griffins are considering paying the federal penalty — about $100 or 1 percent of income next year — rather than buying health insurance. They say they are healthy and don't typically run up large health care costs. Dean Griffin said that will be cheaper because it's unlikely they will get past the nearly $13,000 deductible for the coverage to kick in.
Individual health insurance policies are being canceled because the Affordable Care Act requires plans to cover certain benefits, such as maternity care, hospital visits and mental illness. The law also caps annual out-of-pocket costs consumers will pay each year.
In the past, consumers could get relatively inexpensive, bare-bones coverage, but those plans will no longer be available. Many consumers are frustrated by what they call forced upgrades as they're pushed into plans with coverage options they don't necessarily want.
Ken Davis, who manages a fast food restaurant in Austin, Texas, is recovering from sticker shock after the small-business policy offered by his employer was canceled for the same reasons individual policies are being discontinued.
His company pays about $100 monthly for his basic health plan. He said he'll now have to pay $600 monthly for a mid-tier silver plan on the state exchange. The family policy also covers his 8-year-old son. Even though the federal government is contributing a $500 subsidy, he said the $600 he's left to pay is too high. He's considering the penalty.
"I feel like they're forcing me to do something that I don't want to do or need to do," Davis, 40, said.
Owners of canceled policies have a few options. They can stay in the same plan for the same price for one more year if they have one of the few plans that were grandfathered in. They can buy a similar plan with upgraded benefits that meets the new standards — likely at a significant cost increase. Or, if they make less than $45,960 for a single adult or $94,200 for a family of four, they may qualify for subsidies.
Just because a policy doesn't comply with the law doesn't mean consumers will get cancellation letters. They may get notices saying existing policies are being amended with new benefits and will come with higher premiums. Some states, including Virginia and Kentucky, required insurers to cancel old policies and start from scratch instead of beefing up existing ones.
It's unclear how many individual plans are being canceled — no one agency keeps track. But it's likely in the millions. Insurance industry experts estimate that about 14 million people, or 5 percent of the total market for health care coverage, buy individual policies. Most people get coverage through jobs and aren't affected.
Many states require insurers to give consumers 90 days' notice before canceling plans. That means another round of cancellation letters will go out in March and again in May.
Experts haven't been able to predict how many will pay more or less under the new, upgraded plans. An older policyholder with a pre-existing condition may find that premiums go down, and some will qualify for subsidies.
In California, about 900,000 people are expected to lose existing plans, but about a third will be eligible for subsidies through the state exchange, said Anne Gonzalez, a spokeswoman for the exchange, called Covered California. Most canceled plans provided bare-bones coverage, she said.
"They basically had plans that had gaping holes in the coverage. They would be surprised when they get to the emergency room or the doctor's office, some of them didn't have drug coverage or preventive care," Gonzalez said.
About 330,000 Floridians received cancellation notices from the state's largest insurer, Florida Blue. About 30,000 have plans that were grandfathered in. Florida insurance officials said they're not tracking the number of canceled policies related to the new law.
National numbers are similar: 130,000 cancellations in Kentucky, 140,000 in Minnesota and as many as 400,000 in Georgia, according to officials in those states.
Cigna has sent thousands of cancellation letters to U.S. policyholders but stressed that 99 percent have the option of renewing their 2013 policy for one more year, company spokesman Joe Mondy said.
Cancellation letters are being sent only to individuals and families who purchase their own insurance. However, most policyholders in the individual market will receive some notice that their coverage will change, said Dan Mendelson, president of the market analysis firm Avalere Health.
Changing the Face of 'Obamacare' Website
The cancellations run counter to one of President Barack Obama's promises about his health care overhaul: "If you like your health care plan, you'll be able to keep your health care plan."
Philip Johnson, 47, of Boise, Idaho, was shocked when his cancellation notice arrived last month. The gift-shop owner said he'd spent years arranging doctors covered by his insurer for him, his wife and their two college-age students.
After browsing the state exchange, he said he thinks he'll end up paying lower premiums but higher deductibles. He said the website didn't answer many of his questions, such as which doctors take which plans.
"I was furious because I spent a lot of time and picked a plan that all my doctors accepted," Johnson said. "Now I don't know what doctors are going to take what. No one mentioned that for the last three years when they talked about how this was going to work."
Associated Press writers Christina A. Cassidy in Atlanta; Rachel La Corte in Olympia, Wash.; Marc Levy in Harrisburg, Pa.; Tom Murphy in Indianapolis; Juliet Williams in Sacramento, Calif.; and Kristen Wyatt in Denver contributed to this report.
The Griffins, who live near Philadelphia, pay $770 monthly for their soon-to-be-terminated health care plan with a $2,500 deductible. The cheapest plan they found on their state insurance exchange was a so-called bronze plan charging a $1,275 monthly premium with deductibles totaling $12,700. It covers only providers in Pennsylvania, so the couple, who live near Delaware, won't be able to see doctors they've used for more than a decade.
"We're buying insurance that we will never use and can't possibly ever benefit from. We're basically passing on a benefit to other people who are not otherwise able to buy basic insurance," said Griffin, who is retired from running an information technology company.
The Griffins are among millions of people nationwide who buy individual insurance policies and are receiving notices that those policies are being discontinued because they don't meet the higher benefit requirements of the new law.
They can buy different policies directly from insurers for 2014 or sign up for plans on state insurance exchanges. While lower-income people could see lower costs because of government subsidies, many in the middle class may get rude awakenings when they access the websites and realize they'll have to pay significantly more.
Those not eligible for subsidies generally receive more comprehensive coverage than they had under their soon-to-be-canceled policies, but they'll have to pay a lot more.
Because of the higher cost, the Griffins are considering paying the federal penalty — about $100 or 1 percent of income next year — rather than buying health insurance. They say they are healthy and don't typically run up large health care costs. Dean Griffin said that will be cheaper because it's unlikely they will get past the nearly $13,000 deductible for the coverage to kick in.
Individual health insurance policies are being canceled because the Affordable Care Act requires plans to cover certain benefits, such as maternity care, hospital visits and mental illness. The law also caps annual out-of-pocket costs consumers will pay each year.
In the past, consumers could get relatively inexpensive, bare-bones coverage, but those plans will no longer be available. Many consumers are frustrated by what they call forced upgrades as they're pushed into plans with coverage options they don't necessarily want.
Ken Davis, who manages a fast food restaurant in Austin, Texas, is recovering from sticker shock after the small-business policy offered by his employer was canceled for the same reasons individual policies are being discontinued.
His company pays about $100 monthly for his basic health plan. He said he'll now have to pay $600 monthly for a mid-tier silver plan on the state exchange. The family policy also covers his 8-year-old son. Even though the federal government is contributing a $500 subsidy, he said the $600 he's left to pay is too high. He's considering the penalty.
"I feel like they're forcing me to do something that I don't want to do or need to do," Davis, 40, said.
Owners of canceled policies have a few options. They can stay in the same plan for the same price for one more year if they have one of the few plans that were grandfathered in. They can buy a similar plan with upgraded benefits that meets the new standards — likely at a significant cost increase. Or, if they make less than $45,960 for a single adult or $94,200 for a family of four, they may qualify for subsidies.
Just because a policy doesn't comply with the law doesn't mean consumers will get cancellation letters. They may get notices saying existing policies are being amended with new benefits and will come with higher premiums. Some states, including Virginia and Kentucky, required insurers to cancel old policies and start from scratch instead of beefing up existing ones.
It's unclear how many individual plans are being canceled — no one agency keeps track. But it's likely in the millions. Insurance industry experts estimate that about 14 million people, or 5 percent of the total market for health care coverage, buy individual policies. Most people get coverage through jobs and aren't affected.
Many states require insurers to give consumers 90 days' notice before canceling plans. That means another round of cancellation letters will go out in March and again in May.
Experts haven't been able to predict how many will pay more or less under the new, upgraded plans. An older policyholder with a pre-existing condition may find that premiums go down, and some will qualify for subsidies.
In California, about 900,000 people are expected to lose existing plans, but about a third will be eligible for subsidies through the state exchange, said Anne Gonzalez, a spokeswoman for the exchange, called Covered California. Most canceled plans provided bare-bones coverage, she said.
"They basically had plans that had gaping holes in the coverage. They would be surprised when they get to the emergency room or the doctor's office, some of them didn't have drug coverage or preventive care," Gonzalez said.
About 330,000 Floridians received cancellation notices from the state's largest insurer, Florida Blue. About 30,000 have plans that were grandfathered in. Florida insurance officials said they're not tracking the number of canceled policies related to the new law.
National numbers are similar: 130,000 cancellations in Kentucky, 140,000 in Minnesota and as many as 400,000 in Georgia, according to officials in those states.
Cigna has sent thousands of cancellation letters to U.S. policyholders but stressed that 99 percent have the option of renewing their 2013 policy for one more year, company spokesman Joe Mondy said.
Cancellation letters are being sent only to individuals and families who purchase their own insurance. However, most policyholders in the individual market will receive some notice that their coverage will change, said Dan Mendelson, president of the market analysis firm Avalere Health.
Changing the Face of 'Obamacare' Website
![Changing the Face of 'Obamacare' Website]({"default":"http://img1.catalog.video.msn.com/image.aspx?uuid=0b76c2d0-5c13-af2a-4da1-41ba034892bf&w=300&h=169&so=4"})
Philip Johnson, 47, of Boise, Idaho, was shocked when his cancellation notice arrived last month. The gift-shop owner said he'd spent years arranging doctors covered by his insurer for him, his wife and their two college-age students.
After browsing the state exchange, he said he thinks he'll end up paying lower premiums but higher deductibles. He said the website didn't answer many of his questions, such as which doctors take which plans.
"I was furious because I spent a lot of time and picked a plan that all my doctors accepted," Johnson said. "Now I don't know what doctors are going to take what. No one mentioned that for the last three years when they talked about how this was going to work."
Associated Press writers Christina A. Cassidy in Atlanta; Rachel La Corte in Olympia, Wash.; Marc Levy in Harrisburg, Pa.; Tom Murphy in Indianapolis; Juliet Williams in Sacramento, Calif.; and Kristen Wyatt in Denver contributed to this report.
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