With record highs in sight, stocks face roadblocks

NEW YORK (Reuters) - If Wall Street needs to climb a wall of worry, it will have plenty of opportunity next week.


Major U.S. stock indexes will make another attempt at reaching all-time records, but the fitful pace that has dominated trading is likely to continue. Next Friday's unemployment report and the hefty spending cuts that look like they about to take effect will be at the forefront.


The importance of whether equities can reach and sustain those highs is more than Wall Street's usual fixation on numbers with psychological significance. Breaking through to uncharted territory is seen as a test of investors' faith in the rally.


"It's very significant," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.


"The thinking is, there's just not enough there for an extended bull run," he said. "If we do break through (record highs), then maybe the charts and price action are telling us there's something better ahead."


Flare-ups in the euro zone's sovereign debt crisis and next Friday's report on the U.S. labor market could jostle the market, though U.S. job indicators have generally been trending in a positive direction.


Small- and mid-cap stocks hit lifetime highs in February. Now the Dow Jones industrial average <.dji> and the S&P 500 <.spx> are racing each other to the top. The Dow, made up of 30 stocks, is about 75 points - less than 1 percent - away from its record close of 14,164.53, which it hit on October 9, 2007. The broader S&P is still 3 percent away from its closing high of 1,565.15, also reached on October 9, 2007.


The advantage may be in the Dow's court. So far in 2013, it has gained 7.5 percent, beating the S&P 500 by about 1 percent.


THE RALLY AND THE REALITY CHECK


The Dow's relative strength owes much to its unique make-up and calculation, as well as to investors' recent preference for buying value stocks likely to generate steady reliable gains, rather than growth stocks.


But the more defensive stance illustrates how stock buyers are getting concerned about this year's rally. While investors don't want to miss out on gains, they're picking up companies that are less likely to decline as much as high-flying names - if a market correction comes.


The Russell Value Index <.rav> is up 7.6 percent for the year so far, outpacing the Russell Growth Index's <.rag> 5.7 percent rise. Within the realm of the S&P 500, the consumer staples sector led the market in February, gaining 3.1 percent.


There is some concern that growth-oriented names are being eclipsed by defensive bets, said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research in Cincinnati.


"This isn't a be-all and end-all sell signal by any means, but we would feel much more comfortable if some of the more aggressive areas, like technology and small caps, would start to gain some leadership here," Detrick said.


Signs that investors are becoming concerned about the rally's pace is evident in the options market, where the ratio of put activity to call activity has recently shifted in favor of puts, which represent expectations for a stock to fall.


"We are seeing some put hedging in the financials, building up for the past month," said Henry Schwartz, president of options analytics firm Trade Alert in New York.


The put-to-call ratio representing an aggregate of about 562 financial stocks is 1:1, when normally, calls should be outnumbering puts.


Investors have no shortage of reasons to crave the relative safety of blue chips and defensive stocks. Although markets have mostly looked past uncertainty over Washington's plans to cut the deficit, fiscal policy negotiations still pose a risk to equities.


The $85 billion in spending cuts set to begin on Friday is expected to slow economic growth this year if policymakers do not reach a new deal. Markets so far have held firm despite the wrangling in Washington, but tangible economic effects could pinch stock prices going forward.


The International Monetary Fund warned that full implementation of the cuts would probably take at least 0.5 percentage point off U.S. growth this year.


EASY MONEY AND TEPID HIRING


Investors will also take in a round of economic data at a time when concerns are percolating that the market is being pushed up less by fundamentals and more by loose monetary policy around the world.


The main economic event will be Friday's non-farm payrolls report for February. The U.S. economy is expected to have added 160,000 jobs last month, only a tad higher than in January, in a sign the labor market is healing at a slow pace. The U.S. unemployment rate is forecast to hold steady at 7.9 percent.


While lackluster data has been a catalyst in the past for stock market gains as investors bet it would ensure continued stimulus from the Federal Reserve, that sentiment may be wearing thin.


Markets stumbled last week following worries that the Fed might wind down its quantitative easing program sooner than expected.


"It shows the underpinning of the market is being driven at this point by monetary policy," Hellwig said.


With investors questioning what is behind the rally, it will make a run to record highs even more significant, Hellwig added.


"There's smart people that are in the bull camp and the bear camp and the muddle-through camp," Hellwig said. "The fact that you can statistically, using historical evidence, make a case for going higher, lower, or staying the same makes this number very important this time around."


(Wall St Week Ahead runs every Friday. Comments or questions on this column can be emailed to: leah.schnurr(at)thomsonreuters.com)


(Reporting by Leah Schnurr; Additional reporting by Doris Frankel in Chicago; Editing by Jan Paschal)



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Letter from Europe: Observing the Vatican From Within







ROME — On Feb. 11, the day Benedict XVI stunned the world with the announcement that he would resign from the papacy, Giovanni Maria Vian was at home, getting ready.




It was not surprising that the editor of L’Osservatore Romano, the Vatican’s newspaper, should have been among the handful of people who had advance notice. Sworn to secrecy, Mr. Vian told his staff to listen carefully to Vatican radio that morning.


Since his editors understand Latin, they immediately caught the gist of the pope's speech (so did a reporter for Ansa, the Italian news agency, who broke the story). Within hours, L’Osservatore hit the stands with the news, carefully packaged, and an editorial by Mr. Vian, which said Benedict had made his decision last spring after an exhausting trip to Cuba and Mexico.


“That was a scoop,” Mr. Vian said cheerfully, during an interview in his modest office on a Vatican side street, on a chilly evening after the rest of the staff had gone home.


Since then, Mr. Vian — a scholar whose doctoral thesis was on the writings of early Church leaders — has been calmly navigating the choppy waves of one of the biggest news stories of the year, as it veers from speculation about the next pope to rumors of more scandals in the Roman Catholic Church.


If Mr. Vian remains composed amid all the turmoil, it is because his eight-page newspaper, which comes out in Italian six days a week and weekly in several other languages, is hardly expected to follow the steady drip of slippery stories about gay lobbies, blackmail and dirty Vatican bank accounts.


“There’s nothing new,” he said. “With these articles, one should be very careful. It is normal that they come out now. On the eve of the election of a new pope, there are new dynamics afoot.”


The Vatican, he said, “is a small world, and there are different rumors, different voices. Many times, they are lies. It is very human, all this, but in the end, it all will serve to purify the church — the whole church, not just the Vatican.”


In Mr. Vian’s view, Benedict — who once said he had greeted his election with the dread of someone mounting the steps of the guillotine — had envisioned an early departure right from the start. But the pope, a frail 85, stayed on for almost eight years, Mr. Vian said.


“He doesn’t run away from the wolves,” he said.


So who are the wolves? Mr. Vian was at first surprisingly literal. “The wolves?” he asked. “The most obvious are those who persecute Christians.” There are other wolves, in Christian countries, who are intolerant of believers, he added.


But, he continued, “'there are also wolves within the church, and inside all humans.”


Mr. Vian, ever the scholar, swiveled back and forth between his bookshelf and his computer, pulling out references, from the Roman poet Ovid, and St. Paul’s Letter to the Romans, to the perpetual struggle between good and evil.


Then he dug out, from a pile of newspapers, a lengthy discourse by Benedict himself, made without notes on Feb. 8, in which he spoke of “serious, dangerous omissions,” “errors” and a church that in some places “is dying because of the sins of men and women.”


Mr. Vian, who has run articles on the church's sex abuse scandals, believes that the VatiLeaks scandal, involving the theft of papal documents, was itself a sign that Benedict had succeeded in bringing about greater transparency, prompting a counterreaction. “The papacy of Benedict XVI has been very effective,” he said.


Five years ago, when he was named editor of L’Osservatore, Mr. Vian was hailed as an intellectual journalist, well suited to serve an intellectual pope, who was now his publisher. But his interests range beyond ecclesiastical subjects to include Tintin, the comic-book boy-hero whose posters hang in his office.


Mr. Vian was no stranger to the Vatican. The son of the secretary of the Vatican library, from a family that had ties to previous popes, he grew up within its walls, and played with his brothers in its gardens.


To his father’s dismay, Mr. Vian dabbled in journalism, writing for the Italian Catholic newspaper Avvenire and L’Osservatore, even as he pursued his doctorate and worked on the Italian encyclopedia.


“A rather strange career,” he said, “but it has helped prepare me, to take a critical approach, to respect history and facts. Writing for the encyclopedia is rigorous and sober: You can’t mix in ideology.”


When he took over in the fall of 2007, he wasted no time making changes to the paper. He expanded international news coverage while playing down Italian politics, devoted more attention to economic subjects and widened the cultural scope to include modern phenomena like the Beatles and James Bond. Non-Catholic commentators, including a Jewish columnist, are regularly invited to publish.


He added two women to the paper’s staff — the first in its 152-year history — and started publishing a monthly supplement on “Women, the Church, the World.”


Speaking of Benedict’s resignation, Mr. Vian did not hide his regret. “I am very attached to this pope,” he said. “He’s a real gentleman, a humble, nice man — in other words, a man of God.”


During the last two weeks, Mr. Vian has published a stream of articles on Benedict’s papacy from around the world, including one by a ranking member of the Russian Orthodox Church and one by Shimon Perez, the Israeli president.


The views have been, not surprisingly, uniformly positive. “That’s normal,” said Mr. Vian, asking whether other editors would publish articles critical of their publishers.


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Connie Britton: 'Being a Single Mom Is Challenging'

Connie Britton Nashville MORE
Peggy Sirota for MORE


Channeling her Nashville character’s reign over the country scene was not a far stretch for Connie Britton.


Since her big break in Friday Night Lights, the actress, 45, has been shining in her own spotlight, from scoring major onscreen roles to welcoming a new baby — son Yoby — from Ethiopia.


And now, between her hit show and her 2-year-old, Britton is busier — and happier! — than ever.


“The schedule is insane to the point where I lose a lot of sleep at night worrying about how little time I have to sleep and mostly what little time I have to be with my son,” she says in MORE‘s March issue.


But Britton logging long hours at work doesn’t seem to bother baby boy in the least. “The flip side of that is, he’s doing great. He comes to the set every day,” she says. “As working moms go, at least I have that luxury.”

After the death of her father, Britton put the dream of a husband aside and began to pursue adoption. While idea of raising a baby on her own was daunting, the actress wasn’t willing to call it quits on motherhood.


“Being a single mom is challenging, but never in a million years would that have stopped me. You get an idea in your head and you’re going to do it,” she says.


“People can tell you how hard marriage is or how hard it is to birth a baby, but we do these things. We want the journey of that.”


And her determination has paid off in a big way — Britton is completely smitten with her “incredibly openhearted” son.


“One of my favorite qualities is that he has an enormous curiosity about everything, but he’s not stupid about it,” she explains. “He wants to open and close doors, but he immediately learned that he’d better watch where his fingers are.”


With her professional and personal lives having recently reached all new highs, the new mom says her happiness has been a long time coming.


“My whole life has been building to all the good stuff that has happened to me in the last few years,” Britton muses. “I think — and this is ironic when I’m working harder and have more responsibility than ever before — that I now know the importance of grace and sitting back.”


She continues: “I have a deeper understanding of how most people are just trying to do the best they can.”


Connie Britton Nashville MORE
Peggy Sirota for MORE


– Anya Leon


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WHO: Slight cancer risk after Japan nuke accident


LONDON (AP) — Two years after Japan's nuclear plant disaster, an international team of experts said Thursday that residents of areas hit by the highest doses of radiation face an increased cancer risk so small it probably won't be detectable.


In fact, experts calculated that increase at about 1 extra percentage point added to a Japanese infant's lifetime cancer risk.


"The additional risk is quite small and will probably be hidden by the noise of other (cancer) risks like people's lifestyle choices and statistical fluctuations," said Richard Wakeford of the University of Manchester, one of the authors of the report. "It's more important not to start smoking than having been in Fukushima."


The report was issued by the World Health Organization, which asked scientists to study the health effects of the disaster in Fukushima, a rural farming region.


On March 11, 2011, an earthquake and tsunami knocked out the Fukushima plant's power and cooling systems, causing meltdowns in three reactors and spewing radiation into the surrounding air, soil and water. The most exposed populations were directly under the plumes of radiation in the most affected communities in Fukushima, which is about 150 miles (240 kilometers) north of Tokyo.


In the report, the highest increases in risk are for people exposed as babies to radiation in the most heavily affected areas. Normally in Japan, the lifetime risk of developing cancer of an organ is about 41 percent for men and 29 percent for women. The new report said that for infants in the most heavily exposed areas, the radiation from Fukushima would add about 1 percentage point to those numbers.


Experts had been particularly worried about a spike in thyroid cancer, since radioactive iodine released in nuclear accidents is absorbed by the thyroid, especially in children. After the Chernobyl disaster, about 6,000 children exposed to radiation later developed thyroid cancer because many drank contaminated milk after the accident.


In Japan, dairy radiation levels were closely monitored, but children are not big milk drinkers there.


The WHO report estimated that women exposed as infants to the most radiation after the Fukushima accident would have a 70 percent higher chance of getting thyroid cancer in their lifetimes. But thyroid cancer is extremely rare and one of the most treatable cancers when caught early. A woman's normal lifetime risk of developing it is about 0.75 percent. That number would rise by 0.5 under the calculated increase for women who got the highest radiation doses as infants.


Wakeford said the increase may be so small it will probably not be observable.


For people beyond the most directly affected areas of Fukushima, Wakeford said the projected cancer risk from the radiation dropped dramatically. "The risks to everyone else were just infinitesimal."


David Brenner of Columbia University in New York, an expert on radiation-induced cancers, said that although the risk to individuals is tiny outside the most contaminated areas, some cancers might still result, at least in theory. But they'd be too rare to be detectable in overall cancer rates, he said.


Brenner said the numerical risk estimates in the WHO report were not surprising. He also said they should be considered imprecise because of the difficulty in determining risk from low doses of radiation. He was not connected with the WHO report.


Some experts said it was surprising that any increase in cancer was even predicted.


"On the basis of the radiation doses people have received, there is no reason to think there would be an increase in cancer in the next 50 years," said Wade Allison, an emeritus professor of physics at Oxford University, who also had no role in developing the new report. "The very small increase in cancers means that it's even less than the risk of crossing the road," he said.


WHO acknowledged in its report that it relied on some assumptions that may have resulted in an overestimate of the radiation dose in the general population.


Gerry Thomas, a professor of molecular pathology at Imperial College London, accused the United Nations health agency of hyping the cancer risk.


"It's understandable that WHO wants to err on the side of caution, but telling the Japanese about a barely significant personal risk may not be helpful," she said.


Thomas said the WHO report used inflated estimates of radiation doses and didn't properly take into account Japan's quick evacuation of people from Fukushima.


"This will fuel fears in Japan that could be more dangerous than the physical effects of radiation," she said, noting that people living under stress have higher rates of heart problems, suicide and mental illness.


In Japan, Norio Kanno, the chief of Iitate village, in one of the regions hardest hit by the disaster, harshly criticized the WHO report on Japanese public television channel NHK, describing it as "totally hypothetical."


Many people who remain in Fukushima still fear long-term health risks from the radiation, and some refuse to let their children play outside or eat locally grown food.


Some restrictions have been lifted on a 12-mile (20-kilometer) zone around the nuclear plant. But large sections of land in the area remain off-limits. Many residents aren't expected to be able to return to their homes for years.


Kanno accused the report's authors of exaggerating the cancer risk and stoking fear among residents.


"I'm enraged," he said.


___


Mari Yamaguchi in Tokyo and AP Science Writer Malcolm Ritter in New York contributed to this report.


__


Online:


WHO report: http://bit.ly/YDCXcb


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India Ink: What They Said: Budget 2013-14

Finance Minister Palaniappan Chidambaram presented the Union budget in Parliament on Thursday morning. Reactions were mixed from analysts who felt that while the finance minister had delivered a satisfactory budget given the country’s economic climate, more could have been done to attract foreign investment.

Prime Minister Manmohan Singh, speaking with Doordarshan News:

Given the challenges facing our economy, the finance minister has done a commendable job. India needs to create jobs for our growing labor force to the extent of about 10 million persons every year. To do that, we need to accelerate the tempo of our growth. We need, as the 12th Five-Year Plan has mentioned eloquently, a growth rate of about 8 percent. This is a growth rate which is consistent with our underlying potential. We have to get there. Although this is a difficult journey — it cannot be accomplished in a single year – but the finance minister has taken important steps to reverse the pessimistic view with regard to investment climate, with regard to the growth potential and possibilities of our economy.

The finance minister has laid out a road map. There is plenty of food for every ministry to chew upon. And each one of our ministries has to ask itself this question: If India needs an 8 percent growth rate, growth which is at the same time inclusive and sustainable, what is it that each ministry should do? The finance minister has, I think, mentioned these challenges. It is up to the collective wisdom of my Council of Ministers to convert these challenges into opportunities to accelerate the tempo of growth, to make it more inclusive, to make it more sustainable.

Dinesh Thakkar, chairman and managing director at Angel Broking in Mumbai:

The government’s reform momentum had been so strong since September that there were expectations of some exciting measures in the budget too. That was not the case, but it does not mean the budget was a disappointment. The finance minister has been seriously committed to bringing down the fiscal deficit, and he has delivered on that front, as he did not announce any major populist measure and largely maintained stability in tax policies, save for some tweaking for higher income brackets and corporates. In my view, there were no major positive or negative triggers for the markets or any particular sectors, and I think what the market will look forward to is the reform agenda being continued by the government outside the budget, in the coming Parliament sessions, for which the momentum still looks very much on track.

Anuj Puri, chairman and country head of Jones Lang LaSalle India:

We did not expect this budget to be a game-changer. The realities of the Indian economic situation need to viewed in context with the factors that drive it, not least of all the global economic situation. There is no escaping the fact that the business which comes to India from the European Union and the U.S. has a trickle-down effect on key economic drivers in India, and the Finance Ministry does not control these factors. The Union budget can only hope to address factors within its control.

This was a moderately encouraging budget in general, but tepid for the Indian real estate sector. There has been no proposal on certain key expectations from the real estate sector. These include implementation of the real estate regulator and the Land Acquisition Act. All said and done, Indian real estate will continue to struggle with its larger hurdles. While the affordable housing category has been rightly given due attention, aspects relating to improved transparency and corporate governance within the sector have been largely ignored.

That said, the budget has shown commitment to improving communication on taxation and regulatory policies. This should give more comfort to offshore real estate investors who have been bogged down by the political inertia and therefore unsure of India as an investment destination in the recent past.

Partha Iyengar, country manager for research, India, at Gartner:

The big overarching focus on growth by the finance minister is the fundamental “feel good” factor in this budget. Given the fact that one can argue that a lot of the weakness in the Indian economy is what I call a “sentimental recession,” his strong statement that there is no ground for “doom and gloom” heading into the new year.

The big specific positives of the budget are that he has focused both in terms of the letter and spirit of the budget on the key planks of growth for India and health of every industry, including IT, which is infrastructure, education, skills development and incentives for the growth of domestic manufacturing. Some of the other positive areas are support for entrepreneurship, the M.S.M.E. [micro, small and medium enterprises] sector, both in terms of financial and overall support. The recognition that the overseas “trust deficit” in terms of a comfort level on India’s investment climate has to be addressed is also welcome.

However, the budget is only a directional statement, and the challenge for India historically and even currently is in the execution of the statement of intent outlined in the budget. This has been India’s Achilles’ heel, in that bold pronouncements in the budget never see the light of day or are not implemented as effectively as they can or should be. So it was disappointing to not see any statements on what the government would do to ensure mechanisms and oversight to ensure speedy and efficient implementation of these programs. Overall, a 7/10 score for the budget.

Girish Vanvari, co-head of tax at KPMG:

This budget is along anticipated lines, given the economic scenario in the country. There is a stable tax regime. There is no weird tax introduced; nothing much has been tinkered with. The expenditure outlays of the government have not gone down and so the government is not going to stop spending, which means continued growth.

There is a tax on the super-rich with income above 10 million, but this will only affect about 42,000 people and not impact the larger base. Also, the tax is only a 10 percent surcharge and only effective for one year. In this situation, we have limited choices to manage the fiscal deficit, and the budget is quite good given the situation. It is generally an investor-friendly budget because the crux of this budget is growth. Without growth, the fiscal deficit will not be able to be constrained.

Sujan Hajra, chief economist and executive director at Anand Rathi Financial Services in Mumbai:

Given the macroeconomic climate – slowing growth, stable inflation, high fiscal deficit and current account deficit – this is the best budget that could be rolled out in these circumstances. The overarching priority in this budget is to affect some level of fiscal consolidation, and that has been delivered, having kept the fiscal deficit to 5.2 percent for this year.  The other priority for this budget is to induce financial saving and investment, and many measures have been introduced towards that, such as special incentives for over 1 billion rupees investment, a boost to infrastructure investment, particularly in the power and road sector, widening the scope for investing in mutual funds and the inflation index bond.

Despite this being the last full budget before the next election, the budget has largely resisted taking measures of overt populism. The two largely populist measures taken are the Food Security Act and the Direct Benefit Transfer, and none of these involve any major outlay. The subsidy component of the budget has been reduced rather than increased.

Also there has been some kind of benefit for the bottom of the pyramid with tax benefits for the lowest tax bracket and benefits on housing interest payment for the lower end of the spectrum.

Nobody can term this as a dream budget, but it is trying to address macro concerns and bring about some sort of revival in growth.

Chandrajit Banerjee, director general of the Confederation of India Industry, a trade group:

It is a very well thought through and analytical budget and not a political budget. It is a growth-oriented budget, where the focus on investment has been kept high.

Jaijit Bhattacharya, director for South Asia at Hewlett-Packard:

The IT and electronics manufacturing industry was looking forward to budgetary support to the government’s stated policy of promoting IT & electronics manufacturing in India. But this has not been done in this budget.

Dipen Shah, head of private client group, research, Kotak Securities:

The finance minister has projected a fiscal deficit in line with what he had promised, and it is far better than what the situation was when he had come in. To that extent, he has presented a responsible budget. We believe that the budget focuses rightly on higher investments, which can lead to better growth rates in the future. Several initiatives have been announced in the infrastructure sector. Followup action, in terms of removing infrastructure bottlenecks, will be needed and will go a long way in helping the government achieve the growth targets.

Nishith Desai, managing partner at Nishith Desai Associates, a research-based international law firm:

The budget brings some relief but not much excitement – in particular for foreign investors. It was expected that the finance minister would introduce new tax rates and this did not happen. We expected that estate duty would be reintroduced and this was not done. It was expected that there would be a whole host of new indirect taxes, and that was not done to a large extent. Therefore, it was not the draconian budget expected in the current macroeconomic situation. Only the super-rich have been charged a 10 percent surcharge, which is not too much of a burden, in my view.

However, we expected some big bang reforms for bringing foreign investment to India, which did not happen. The finance minister started by saying that foreign investment is “imperative,” but that imperative was soon lost. There was no assurance made to guarantee a stable regulatory environment and that there would not be any more retroactive amendments in general. It was expected that the finance minister would address cases that involve the offshore transfer of shares like Vodafone so that there could be some certainty, but this was not done.

I believe the finance minister will have to present another round of liberalization and reforms to attract foreign investment. I think that he has tried to please everybody, which is not a bad thing. But at the same time, if you look at this from the viewpoint of attracting the foreign investment necessary for growth – that has not happened.

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Why Jennifer Aniston Kept Her Hair Down on Oscar Night







Style News Now





02/26/2013 at 02:30 PM ET











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Her longtime stylist, Living Proof’s Chris McMillan, says the star wanted to stick with what works. “She wanted to keep the makeup natural and the hair natural,” he says in the exclusive clip above. “I think it’s about, at this point, being really comfortable on the red carpet.” Amen!

To hear more on Aniston’s Oscar night look, and to hear McMillan give a how-to on the night’s hot short hairstyles (his faves were Anne Hathaway and Charlize Theron), watch the clip above. Tell us: Did you like Aniston’s natural hair and makeup on Oscar night? 

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Medicare paid $5.1B for poor nursing home care


SAN FRANCISCO (AP) — Medicare paid billions in taxpayer dollars to nursing homes nationwide that were not meeting basic requirements to look after their residents, government investigators have found.


The report, released Thursday by the Department of Health and Human Services' inspector general, said Medicare paid about $5.1 billion for patients to stay in skilled nursing facilities that failed to meet federal quality of care rules in 2009, in some cases resulting in dangerous and neglectful conditions.


One out of every three times patients wound up in nursing homes that year, they landed in facilities that failed to follow basic care requirements laid out by the federal agency that administers Medicare, investigators estimated.


By law, nursing homes need to write up care plans specially tailored for each resident, so doctors, nurses, therapists and all other caregivers are on the same page about how to help residents reach the highest possible levels of physical, mental and psychological well-being.


Not only are residents often going without the crucial help they need, but the government could be spending taxpayer money on facilities that could endanger people's health, the report concluded. The findings come as concerns about health care quality and cost are garnering heightened attention as the Obama administration implements the nation's sweeping health care overhaul.


"These findings raise concerns about what Medicare is paying for," the report said.


Investigators estimate that in one out of five stays, patients' health problems weren't addressed in the care plans, falling far short of government directives. For example, one home made no plans to monitor a patient's use of two anti-psychotic drugs and one depression medication, even though the drugs could have serious side effects.


In other cases, residents got therapy they didn't need, which the report said was in the nursing homes' financial interest because they would be reimbursed at a higher rate by Medicare.


In one example, a patient kept getting physical and occupational therapy even though the care plan said all the health goals had been met, the report said.


The Office of Inspector General's report was based on medical records from 190 patient visits to nursing homes in 42 states that lasted at least three weeks, which investigators said gave them a statistically valid sample of Medicare beneficiaries' experiences in skilled nursing facilities.


That sample represents about 1.1 million patient visits to nursing homes nationwide in 2009, the most recent year for which data was available, according to the review.


Overall, the review raises questions about whether the system is allowing homes to get paid for poor quality services that may be harming residents, investigators said, and recommended that the Centers for Medicare & Medicaid Services tie payments to homes' abilities to meet basic care requirements. The report also recommended that the agency strengthen its regulations and ramp up its oversight. The review did not name individual homes, nor did it estimate the number of patients who had been mistreated, but instead looked at the overall number of stays in which problems arose.


In response, the agency agreed that it should consider tying Medicare reimbursements to homes' provision of good care. CMS also said in written comments that it is reviewing its own regulations to improve enforcement at the homes.


"Medicare has made significant changes to the way we pay providers thanks to the health care law, to reward better quality care," Medicare spokesman Brian Cook said in a statement to AP. "We are taking steps to make sure these facilities have the resources to improve the quality of their care, and make sure Medicare is paying for the quality of care that beneficiaries are entitled to."


CMS hires state-level agencies to survey the homes and make sure they are complying with federal law, and can require correction plans, deny payment or end a contract with a home if major deficiencies come to light. The agency also said it would follow up on potential enforcement at the homes featured in the report.


Greg Crist, a Washington-based spokeswoman for the American Health Care Association, which represents the largest share of skilled nursing facilities nationwide, said overall nursing home operators are well regulated and follow federal guidelines but added that he could not fully comment on the report's conclusions without having had the chance to read it.


"Our members begin every treatment with the individual's personal health needs at the forefront. This is a hands-on process, involving doctors and even family members in an effort to enhance the health outcome of the patient," Crist said.


Virginia Fichera, who has relatives in two nursing homes in New York, said she would welcome a greater push for accountability at skilled nursing facilities.


"Once you're in a nursing home, if things don't go right, you're really a prisoner," said Fichera, a retired professor in Sterling, NY. "As a concerned relative, you just want to know the care is good, and if there are problems, why they are happening and when they'll be fixed."


Once residents are ready to go back home or transfer to another facility, federal law also requires that the homes write special plans to make sure patients are safely discharged.


Investigators found the homes didn't always do what was needed to ensure a smooth transition.


In nearly one-third of cases, facilities also did not provide enough information when the patient moved to another setting, the report found.


___


On the Web:


The OIG report: http://1.usa.gov/VaztQm


The Medicare nursing home database: http://www.medicare.gov/NursingHomeCompare/search.aspx?bhcp=1&AspxAutoDetectCookieSupport=1


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Follow Garance Burke on Twitter at —http://twitter.com/garanceburke.


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Stock futures tick higher ahead of GDP, jobless data


NEW YORK (Reuters) - Stock index futures edged modestly higher on Thursday as investors were reluctant to make big bets following a sharp two-day rally and ahead of a rash of data.


Investors will also be keeping an eye on the debate in Washington over sequestration - U.S. government budget cuts that will take effect starting on Friday if lawmakers fail to reach an agreement on spending and taxes. President Barack Obama and Republican congressional leaders arranged to hold last-ditch talks to prevent the cuts, but expectations were low that any deal would be produced.


Major indexes posted their biggest daily gains since early January on Wednesday, putting the S&P 500 back above the closely watched level of 1,500. Over the past two sessions, the index has gained 1.9 percent, lifted by strong data and comments from Federal Reserve Chairman Ben Bernanke that showed continued support for the Fed's stimulus policy.


Wall Street has largely resisted predictions it would undergo a correction, with the S&P up 6.3 percent so far this year and the Dow Jones industrial average within striking distance of an all-time high. While markets suffered steep losses earlier this week on concerns over European debt, they have since recovered and are flat on the week.


Revised gross domestic product data is expected to show that the U.S. economy grew 0.5 percent in the fourth quarter, rather than contracted 0.1 percent as initially estimated. The data is due at 8:30 a.m. (1330 GMT)


Weekly jobless claims, also on tap for 8:30 a.m., are seen dipping by 2,000 to 360,000 in the latest week, while the February Chicago PMI is seen dipping to 54.3 from 55.6 last month.


Those reports come in the wake of strong pending home sales data Wednesday and a proxy for business spending plans that was more robust than expected, which added to the positive tone in markets.


S&P 500 futures rose 2.7 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures added 16 points and Nasdaq 100 futures rose 4.5 points.


J.C. Penney Co Inc shares slumped 15 percent to $18.01 in premarket trading a day after it reported a steep drop in sales, prompting the department store to overhaul its pricing strategy.


Groupon Inc also reported revenue that missed expectations, sending shares down 26 percent to $4.41 before the bell.


Salesforce.com Inc and Gap Inc are on tap to report results later Thursday.


With 93 percent of the S&P 500 companies having reported results so far, 69.5 percent have beaten profit expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters, according to Thomson Reuters data.


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 6.2 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


Tim Cook, chief executive of Apple Inc , acknowledged widespread disappointment Wednesday in the performance of the tech titan's stock, which is down 16.5 percent so far this year, but urged investors to take a long-term view on the company.


(Editing by Bernadette Baum)



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India Ink: Revisiting the Horror in Sri Lanka







NEW DELHI — In the series of photographs shot in 2009, the bare-chested boy is first shown seated on a bench watching something outside the frame. Then he is seen having a snack. In the third image he is lying on the ground with bullet holes in his chest. The photographs, which were released last week by the British broadcaster Channel 4, appear to document the final moments in the life of 12-year-old Balachandran Prabhakaran, the youngest son of the slain founder of the Liberation Tigers of Tamil Eelam, Velupillai Prabhakaran.




The images are from the documentary film “No Fire Zone,” which tells the story of Sri Lanka’s violent suppression of Mr. Prabhakaran’s equally violent revolution, which had come very close to securing a separate state for the Tamil minority of Sri Lanka. After 26 years of civil war between the Tamils, who are chiefly Hindus, and the Sinhalese majority, who are chiefly Buddhists, the Sri Lankan state won decisively in 2009. Human rights activists say that hundreds of Tamil fighters, political leaders and their families, including Mr. Prabhakaran and his family, did not die in action but were executed. They estimate that more than 40,000 Tamil civilians died in the final months of the war.


Within its borders, the Sri Lankan government appears to wink at its Sinhalese population to accept their congratulations for ending the war, but it maintains a righteous indignation when the world accuses its army of planned genocide.


“No Fire Zone” includes video footage and photographs shot on mobile phones by Tamil survivors and Sinhalese soldiers that were somehow leaked. The film’s director, Callum Macrae, told me that it will be screened at the 22nd session of the U.N. Human Rights Council, now under way in Geneva, where the United States plans to introduce a resolution asking Sri Lanka to investigate the allegations of war crimes by its army.


It is not clear what such a resolution will achieve because Sri Lanka’s powerful president, Mahinda Rajapaksa, who has a rustic swagger about him and a manly black mustache, is the triumphant face of Sri Lanka’s victory in the war. The Sri Lankan Army is unambiguously under his control. Whatever the worth of the resolution, India is expected to support it more enthusiastically than it did a similar resolution last March.


Over the years, the shape and location of Sri Lanka have inspired several Indian cartoonists to portray the island nation as a tear drop beneath India’s peninsular chin. This is an illogical depiction of Sri Lanka’s trauma because a tear drop is not sorrowful; it is a consequence of someone’s sorrow. Some caricatures that appeared in the late 1980s and early 1990s, however, showed the Indian peninsula weeping and Sri Lanka as the consequent tear drop. This imagery had a stronger logic. India’s history with Sri Lanka is, in a way, about a bumbling giant being hurt by a cunning dwarf.


Under the late Prime Minister Indira Gandhi, the type of strategists who imagine they are great Machiavellian characters, and love to add the prefix “geo” to “politics” to feel good about their advisory jobs, ensured that India armed and financed the Tamil rebels. In 1984, when she was assassinated and her son Rajiv Gandhi took over as prime minister, Sri Lanka was engaged in a full-fledged civil war. Now, India wanted to play gracious giant in the region and bring peace to Sri Lanka. In 1987, it sent troops to achieve that end. It was a disastrous move, and resulted in the deaths of nearly 1,200 Indian soldiers and thousands of Tamil fighters. In an act of vengeance, Mr. Prabhakaran made his greatest strategic blunder: ordering the assassination of Rajiv Gandhi.


On the early morning of May 22, 1991, as the news spread through Madras (now Chennai) by phone and radio, I saw people run out of their homes in some kind of delirium to pick up the newspapers from their porches. The city had just woken up to the improbable fact that a suicide bomber had killed Mr. Gandhi the previous night in a small town not far from Chennai. Until then, the southern state of Tamil Nadu, whose capital is Chennai, was a haven for the Tamil Tigers. Bound by a common language, the masses of Tamil Nadu felt a deep compassion for the struggle of Sri Lankan Tamils. But Mr. Gandhi’s assassination was seen by them as an act of war against India. The chief minister of Tamil Nadu at the time, Muthuvel Karunanidhi, who was accused of being a friend of the Tigers, went around Chennai in an open-roof van, standing with his palms joined in apology. That was not good enough. In the 1991 Tamil Nadu assembly elections, his party won only two seats.


But now, the plight of the Sri Lankan Tamils has returned as a passionate political issue in Tamil Nadu. Mr. Karunanidhi is too old to stand anymore but even as a patriarch who uses a wheelchair, he is a useful ally of the Indian National Congress party, which heads the national government. He has often demanded that the accomplices of Mr. Gandhi’s assassin now on death row in India be pardoned, and that President Rajapaksa be tried on war crimes charges. Last year, when the United States introduced a resolution against Sri Lanka, India was reluctant to back it for strategic reasons, including that it has commercial interests in Sri Lanka, which China is fast grabbing. But Mr. Karunanidhi and public sentiment in Tamil Nadu finally persuaded the Indian government to support it.


In a few days, when the United States introduces its new resolution against Sri Lanka, the brute forces of politics and practicality will ensure that the Indian government led by the Congress party, whose leader is Sonia Gandhi, will join other nations in asking Sri Lanka to explain how exactly it eliminated the organization that made her a widow.


Manu Joseph is editor of the Indian newsweekly Open and author of the novel “The Illicit Happiness of Other People.”


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Jennifer Aniston & Justin Theroux's Wedding Planning Underway









02/27/2013 at 07:50 AM EST



She conquered the Oscars, and now Jennifer Aniston is preparing for another very big day.

The actress, 44, is in the process of planning her wedding to screenwriter-actor Justin Theroux, 41 – and she has already checked off some major tasks on her to-do list, including choosing wedding bands, setting a date and narrowing down dresses.

Just don't expect the wedding, which is likely to take place soon after Aniston wraps her current film in Connecticut on March 8, to be a lavish production.

"It will be a small affair with their closest friends," a source close to Aniston tells PEOPLE in this week's cover story.

In the meantime, the bride-to-be is enjoying life with her future groom.

"Jen seems more confident than ever," says the source, "and they've become a great team."

For much more on Aniston and Theroux's wedding plans, their romantic Oscar night and look inside their relationship, pick up this week's issue of PEOPLE

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