Anonymous Hijacks Federal Website Over Reddit Co-Founder's Suicide

Jan 26, 2013 12:27pm

(AP Photo)

Activists from the hacker collective known as Anonymous assumed control over the homepage of a federal judicial agency this morning.

In a manifesto left on the defaced page, the group demanded reform to the American justice system and what the activists said are threats to the free flow of information.

The lengthy essay largely mirrors previous demands from Anonymous, but this time the group also cited the recent suicide of Reddit co-founder and activist Aaron Swartz as has having “crossed a line” for their organization. Swartz was facing up to 35 years in prison on computer fraud charges.

Prosecutors said he had stolen thousands of digital scientific and academic journal articles from the Massachusetts Institute of Technology with the goal of disseminating them for free.

Read More: Aaron Swartz’ Death Fuels MIT Probe, White House Petition to Oust Prosecutor

Anonymous says Swartz was “killed because he was forced into playing a game he could not win — a twisted and distorted perversion of justice — a game where the only winning move was not to play.”

“There must be a return to proportionality of punishment with respect to actual harm caused,” it reads, also mentioning recent arrests of Anonymous associates by the FBI.

In their statement, the hackers say they targeted the homepage of the Federal Sentencing Commission for “symbolic” reasons.

The group claimed that if their demands were not met they would release a trove of embarrassing internal Justice Department documents to media outlets. Anonymous named the files after Supreme Court justices and provided hyperlinks to them from the defaced page.

As of press time the commission’s site had been taken offline but an earlier attempt by CNN to follow the files’ links yielded dead-ends, mostly offline sites.

The file names use an “.aes256″ suffix, denoting a common encryption protocol. The same system was used to encrypt the Wikileaks Afghan war documents before their release.

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At least 30 die in riots over Egyptian death sentences

PORT SAID, Egypt/CAIRO (Reuters) - At least 30 people were killed on Saturday when Egyptians rampaged in protest at the sentencing of 21 people to death over a soccer stadium disaster, violence that compounds a political crisis facing Islamist President Mohamed Mursi.

Armored vehicles and military police fanned through the streets of Port Said, where gunshots rang out and protesters burned tires in anger that people from their city had been blamed for the deaths of 74 people at a match last year.

The rioting in Port Said, one of the most deadly spasms of violence since Hosni Mubarak's ouster two years ago, followed a day of anti-Mursi demonstrations on Friday, when nine people were killed. The toll over the past two days stands at 39.

The flare-ups make it even tougher for Mursi, who drew fire last year for expanding his powers and pushing through an Islamist-tinged constitution, to fix the creaking economy and cool tempers enough to ensure a smooth parliamentary election.

That vote is expected in the next few months and is meant to cement a democratic transition that has been blighted from the outset by political rows and street clashes.

The National Defense Council, which is led by Mursi and includes the defense minister who commands the army, called for "a broad national dialogue that would be attended by independent national characters" to discuss political differences and ensure a "fair and transparent" parliamentary poll.

The statement was made on state television by Information Minister Salah Abdel Maqsoud, who is also on the council.

The National Salvation Front of liberal-minded groups and other Mursi opponents cautiously welcomed the call, but demanded any such dialogue have a clear agenda and guarantees that any deal would be implemented, spokesman Khaled Dawoud told Reuters.

The Front spurned previous calls for dialogue, saying Mursi had ignored voices beyond his Islamist allies. The Front earlier on Saturday threatened an election boycott and to call for more protests on Friday if demands were not met.

Its demands included picking a national unity government to restore order and holding an early presidential poll.

THREATS OF VIOLENCE

The political statements followed clashes in Port Said that erupted after a judge issued a verdict sentencing 21 men to die for involvement in the deaths at the soccer match on February 1, 2012. Many were fans of the visiting team, Cairo's Al Ahly.

Al Ahly fans had threatened violence if the court had not meted out the death penalty. They cheered outside their Cairo club when the verdict was announced. But in Port Said, residents were furious that people from their city were held responsible.

Protesters ran wildly through the streets of the Mediterranean port, lighting tires in the street and storming two police stations, witnesses said. Gunshots were reported near the prison where most of the defendants were being held.

A director for Port Said hospitals told state television that 30 people had been killed, many as a result of gunshot wounds. He said more than 300 had been wounded.

Inside the court in Cairo, families of victims danced, applauded and some broke down in tears of joy when they heard Judge Sobhy Abdel Maguid declare that the 21 men would be "referred to the Mufti", a phrase used to denote execution, as all death sentences must be reviewed by Egypt's top religious authority.

There were 73 defendants on trial. Those not sentenced on Saturday would face a verdict on March 9, the judge said.

At the Port Said soccer stadium a year ago, many spectators were crushed and witnesses saw some thrown off balconies after the match between Al Ahly and local team al-Masri. Al Ahly fans accused the police of being complicit in the deaths.

Among those killed was a former player for al-Masri and a soccer player in another Port Said team, the website of the state broadcaster reported.

TEARGAS FIRED

On Friday, protesters angry at Mursi's rule had taken to the streets for the second anniversary of the uprising that erupted on January 25, 2011 and which brought Mubarak down 18 days later.

Police fired teargas and protesters hurled stones and petrol bombs. Nine people were killed, mainly in the port city of Suez, and hundreds more were injured across the nation.

Reflecting international concern at the two days of clashes, British Foreign Office Minister for the Middle East Alistair Burt said: "This cannot help the process of dialogue which we encourage as vital for Egypt today, and we must condemn the violence in the strongest terms."

On Saturday, some protesters again clashed and scuffled with police in Cairo, Alexandria and other cities. In the capital, youths pelted police lines with rocks near Tahrir Square. In Suez, police fired teargas when protesters angry at Friday's deaths hurled petrol bombs and stormed a police post.

"We want to change the president and the government. We are tired of this regime. Nothing has changed," said Mahmoud Suleiman, 22, in Cairo's Tahrir Square, the cauldron of the 2011 anti-Mubarak revolt.

Mursi's opponents say he has failed to deliver on economic pledges or to be a president representing the full political and communal diversity of Egyptians, as he promised.

"Egypt will not regain its balance except by a political solution that is transparent and credible, by a government of national salvation to restore order and heal the economy and with a constitution for all Egyptians," prominent opposition politician Mohamed ElBaradei wrote on Twitter.

Mursi's supporters say the opposition does not respect the democracy that has given Egypt its first freely elected leader.

The Muslim Brotherhood, which propelled Mursi to office, said in a statement that "corrupt people" and media who were biased against the president had stirred up fury on the streets.

The frequent violence and political schism between Islamists and secular Egyptians have hurt Mursi's efforts to revive an economy in crisis as investors and tourists have stayed away, taking a heavy toll on Egypt's currency.

(Additional reporting by Omar Fahmy, and Peter Griffiths in London; Writing by Edmund Blair; Editing by Mark Trevelyan)

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Polling Day commences for 31,600 voters in Punggol East

SINGAPORE: Punggol East residents will head to the polls on Friday, Polling Day, as Singapore marks its second by-election in eight months.

Some 31,600 voters in Singapore and 59 voters overseas will cast their votes in a four-cornered fight for the single member constituency (SMC).

The Punggol East single member seat fell vacant in December 2012 when former Speaker of Parliament and MP for the ward Michael Palmer resigned over an extramarital affair.

A writ of election was issued by President Tony Tan on 9 January 2013, declaring 16 January as Nomination Day and 26 January as Polling Day.

Prime Minister Lee Hsien Loong said at the announcement of the by-election that he wanted to give Punggol East residents their own MP in Parliament before Singapore focused back on its "busy national agenda". This includes the upcoming White Paper on population, the Budget 2013 debate and the Our Singapore Conversation project.

Voters issued with poll cards are reminded to bring their identity card or passport for verification at polling stations. Their poll card will indicate the polling station nearest to their home, at which they would cast their vote.

Polling stations will be open from 8am until 8pm.

The four candidates contesting the Punggol East by-election are Dr Koh Poh Koon from the People's Action Party, Mr Kenneth Jeyaretnam from the Reform Party, Mr Desmond Lim Bak Chuan from the Singapore Democratic Alliance and Ms Lee Li Lian from the Workers' Party.

Mr Lim and Ms Lee contested Punggol East SMC in the 2011 General Election but lost to PAP's Michael Palmer.

The Returning Officer for the by-election is Mr Yam Ah Mee.

Results are expected after 10pm on Friday.

A special by-election programme will be aired on Channel NewsAsia from 9pm Singapore/Hong Kong time.

- CNA/jc

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Jaipur Literature Festival shifts focus to cinema on second day

JAIPUR: The debate shifted from literature to cinema on the second day of the Jaipur Literature Festival on Friday.

Actor Shabana Azmi questioned the portrayal of women in films in a session on the subject. She called for a need for heroines to ''make an informed choice'' about the roles they play and the way they are portrayed. ''My problem is that the commoditization of women is, very often, happening at a subliminal level, without the women themselves understanding it.''

Lyricist Prasoon Joshi called for an urgent need to deconstruct the language and sexism implicit in the problematic portrayal of women. ``The women have to given the freedom to make choices... (and) not be forced into stereotypes of mother, working woman,'' he said. ''Just like it is unfair to portray a woman as someone who is always in the kitchen, it is equally unfair that a woman, who chooses to not work, is given the space and freedom to not work.''

He maintained that the filmmakers are conscious of their roles in shaping the society and said they are constantly making an effort to introspect and to balance the way men and women are projected.

Lyricist Javed Akhtar spoke about the interdependency of films and the society. He insisted that though there is immense scope for meaningful cinema, its viability remains a pressing concern.

''If you care for a Paan Singh Tomar ensure that the film makes Rs 200 crore profit at the box office and I can assure more such films can be made,'' he said while responding to question from the audience.

Akhtar pointed out that films are a reflection of the society and that heroes reflect it and its morality just like villains in the 1950s ``...the zamindar was the villain. It changed over the years to the corporate, industrialist, who was projected as the villain. Finally, by the 70's, the angry young man as the hero was a projection of a society disillusioned by its social context.''

He said the Indian audiences are now looking for films that entertain and are an opportunity to ''party''.

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Penalty could keep smokers out of health overhaul

WASHINGTON (AP) — Millions of smokers could be priced out of health insurance because of tobacco penalties in President Barack Obama's health care law, according to experts who are just now teasing out the potential impact of a little-noted provision in the massive legislation.

The Affordable Care Act — "Obamacare" to its detractors — allows health insurers to charge smokers buying individual policies up to 50 percent higher premiums starting next Jan. 1.

For a 55-year-old smoker, the penalty could reach nearly $4,250 a year. A 60-year-old could wind up paying nearly $5,100 on top of premiums.

Younger smokers could be charged lower penalties under rules proposed last fall by the Obama administration. But older smokers could face a heavy hit on their household budgets at a time in life when smoking-related illnesses tend to emerge.

Workers covered on the job would be able to avoid tobacco penalties by joining smoking cessation programs, because employer plans operate under different rules. But experts say that option is not guaranteed to smokers trying to purchase coverage individually.

Nearly one of every five U.S. adults smokes. That share is higher among lower-income people, who also are more likely to work in jobs that don't come with health insurance and would therefore depend on the new federal health care law. Smoking increases the risk of developing heart disease, lung problems and cancer, contributing to nearly 450,000 deaths a year.

Insurers won't be allowed to charge more under the overhaul for people who are overweight, or have a health condition like a bad back or a heart that skips beats — but they can charge more if a person smokes.

Starting next Jan. 1, the federal health care law will make it possible for people who can't get coverage now to buy private policies, providing tax credits to keep the premiums affordable. Although the law prohibits insurance companies from turning away the sick, the penalties for smokers could have the same effect in many cases, keeping out potentially costly patients.

"We don't want to create barriers for people to get health care coverage," said California state Assemblyman Richard Pan, who is working on a law in his state that would limit insurers' ability to charge smokers more. The federal law allows states to limit or change the smoking penalty.

"We want people who are smoking to get smoking cessation treatment," added Pan, a pediatrician who represents the Sacramento area.

Obama administration officials declined to be interviewed for this article, but a former consumer protection regulator for the government is raising questions.

"If you are an insurer and there is a group of smokers you don't want in your pool, the ones you really don't want are the ones who have been smoking for 20 or 30 years," said Karen Pollitz, an expert on individual health insurance markets with the nonpartisan Kaiser Family Foundation. "You would have the flexibility to discourage them."

Several provisions in the federal health care law work together to leave older smokers with a bleak set of financial options, said Pollitz, formerly deputy director of the Office of Consumer Support in the federal Health and Human Services Department.

First, the law allows insurers to charge older adults up to three times as much as their youngest customers.

Second, the law allows insurers to levy the full 50 percent penalty on older smokers while charging less to younger ones.

And finally, government tax credits that will be available to help pay premiums cannot be used to offset the cost of penalties for smokers.

Here's how the math would work:

Take a hypothetical 60-year-old smoker making $35,000 a year. Estimated premiums for coverage in the new private health insurance markets under Obama's law would total $10,172. That person would be eligible for a tax credit that brings the cost down to $3,325.

But the smoking penalty could add $5,086 to the cost. And since federal tax credits can't be used to offset the penalty, the smoker's total cost for health insurance would be $8,411, or 24 percent of income. That's considered unaffordable under the federal law. The numbers were estimated using the online Kaiser Health Reform Subsidy Calculator.

"The effect of the smoking (penalty) allowed under the law would be that lower-income smokers could not afford health insurance," said Richard Curtis, president of the Institute for Health Policy Solutions, a nonpartisan research group that called attention to the issue with a study about the potential impact in California.

In today's world, insurers can simply turn down a smoker. Under Obama's overhaul, would they actually charge the full 50 percent? After all, workplace anti-smoking programs that use penalties usually charge far less, maybe $75 or $100 a month.

Robert Laszewski, a consultant who previously worked in the insurance industry, says there's a good reason to charge the maximum.

"If you don't charge the 50 percent, your competitor is going to do it, and you are going to get a disproportionate share of the less-healthy older smokers," said Laszewski. "They are going to have to play defense."

___

Online:

Kaiser Health Reform Subsidy Calculator — http://healthreform.kff.org/subsidycalculator.aspx

Read More..

White House Makeover: McDonough to Chief of Staff

Jan 25, 2013 10:15am

Orlando Sierra/AFP/Getty Images

By ANN COMPTON and MARY BRUCE

President Obama is giving his West Wing team an extreme make-over for the second term, with the departure of top strategist David Plouffe and the naming of Deputy National Security Adviser Denis McDonough to be his next chief of staff.

Once again, the President is keeping a comfort zone around him, promoting from within. He is plucking a favorite aide from his national security team to become the new White House Chief of Staff.  McDonough  has been a popular figure in the Obama inner circle since the Senate days.

McDonough was widely expected to become Obama’s fifth chief of staff as he replaces Jack Lew who has been nominated as Treasury Secretary.

“Welcome to the announcement of one of the worst kept secrets in Washington,” Obama joked as he announced McDonough’s new position in the East Room of the White House.

The president heaped praise on his longtime adviser and close friend, as McDonough stood beaming by his side.

“I have been counting on Denis for nearly a decade — since I first came to Washington, when he helped set up my Senate office,” Obama said. “He was able to show me where the restrooms were and how you passed a bill…  At that time, I relied on his intellect and his good judgment, and that has continued ever since.”

“I cannot imagine the White House without you.  Thank you for signing up for this very, very difficult job,” Obama said.  ”I know you’ll always give it to me straight, as only a friend can — telling me not only what I want to hear, but more importantly what I need to hear to make the best possible decisions on behalf of the American people.”

Plouffe’s departure from the tiny office next to the president’s makes room for strategist Dan Pfeiffer’s promotion to senior adviser.  Pfeiffer is a combative planner who has been orchestrating the administration’s message for the last four years.

“I thought I’d take the occasion to just embarrass somebody.  Some of you may know that today is David Plouffe’s last day in the White House,” Obama said to laughter from the audience comprised largely of White House staff.  ”I had to hide this in the end of my remarks because I knew he wouldn’t want me to bring it up.  So we had some secret squirrel stuff going on here to avoid him thinking that we were going to talk about him.”

“I can’t tell you how lucky I have been to have him manage our campaign back in 2008, then join the White House during these very challenging last two years.  He’s built a well-deserved reputation as being a numbers genius and a pretty tough combatant when it comes to politics,” he said. “Were it not for him, we would not have been as effective a White House and I probably wouldn’t be here.”

Pfeiffer’s deputy, Jennifer Palmieri, a long-time Democratic figure, moves up to communications director. Rob Nabors was a key figure in negotiating with Congress and he’s getting promoted to the top policy job in the West Wing’s chief of staff office.

From the Department of Justice, Lisa Monaco will come in as the new counter-terrorism adviser, taking John Brennan’s chair if he is confirmed as CIA Director.

The only other outsider coming into the West Wing is David Simas who worked on the re-election campaign. Simas will do communications.  There are no announced changes in Jay Carney’s press office.

SHOWS: World News

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Five die in Egypt violence on anniversary of uprising

CAIRO/ISMAILIA, Egypt (Reuters) - Five people were shot dead in the Egyptian city of Suez during nationwide protests against President Mohamed Mursi on Friday, the second anniversary of the uprising that toppled Hosni Mubarak.

One of the dead was a member of the security forces, medics said. Another 280 civilians and 55 security personnel were injured, officials said, in demonstrations fuelled by anger at the president and his Islamist allies in the Muslim Brotherhood.

Thousands of opponents of Mursi massed in Cairo's Tahrir Square - the cradle of the revolt against Mubarak - to rekindle the demands of a revolution they say has been hijacked by Islamists who have betrayed its goals.

Street battles erupted in Cairo, Alexandria, Suez and Port Said. Arsonists attacked at least two state-owned buildings as symbols of government were targeted. An office used by the Muslim Brotherhood's political party was also torched.

The January 25 anniversary laid bare the divide between the Islamists and their secular rivals.

This schism is hindering the efforts of Mursi, elected in June, to revive an economy in crisis and reverse a plunge in Egypt's currency by enticing back investors and tourists.

Inspired by the popular uprising in Tunisia, Egypt's revolution spurred further revolts across the Arab world. But the sense of common purpose that united Egyptians two years ago has given way to internal strife that had already triggered bloody street battles last month.

"Our revolution is continuing. We reject the domination of any party over this state. We say no to the Brotherhood state," Hamdeen Sabahy, a popular leftist leader, told Reuters.

The Brotherhood decided against mobilizing for the anniversary, wary of the scope for more conflict after December's violence, stoked by Mursi's decision to fast-track an Islamist-tinged constitution rejected by his opponents.

The Brotherhood denies accusations that it is seeking to dominate Egypt, labeling them a smear campaign by its rivals.

DEATH IN SUEZ

There were conflicting accounts of the lethal shooting in Suez. Some witnesses said security forces had opened fire in response to gunfire from masked men.

News of the deaths capped a day of violence which started in the early hours. Before dawn in Cairo, police battled protesters who threw petrol bombs and firecrackers as they approached a wall blocking access to government buildings near Tahrir Square.

Clouds of tear gas filled the air. At one point, riot police used one of the incendiaries thrown at them to set ablaze at least two tents erected by youths, a Reuters witness said.

Skirmishes between stone-throwing youths and the police continued in streets around the square into the day. Ambulances ferried away a steady stream of casualties.

Protesters echoed the chants of 2011's historic 18-day uprising. "The people want to bring down the regime," they chanted. "Leave! Leave! Leave!" chanted others as they marched towards the square.

"We are not here to celebrate but to force those in power to submit to the will of the people. Egypt now must never be like Egypt during Mubarak's rule," said Mohamed Fahmy, an activist.

There were similar scenes in Suez and Alexandria, where protesters and riot police clashed near local government offices. Black smoke billowed from tires set ablaze by youths.

In Cairo, police fired tear gas to disperse a few dozen protesters trying to remove barbed-wire barriers protecting the presidential palace, witnesses said. A few masked men got as far as the gates before they were beaten back.

Tear gas was also fired at protesters who tried to remove metal barriers outside the state television building.

Outside Cairo, protesters broke into the offices of provincial governors in Ismailia and Kafr el-Sheikh in the Nile Delta. A local government building was torched in the Nile Delta city of al-Mahalla al-Kubra.

BADIE CALLS FOR "PRACTICAL, SERIOUS COMPETITION"

With an eye on parliamentary elections likely to begin in April, the Brotherhood marked the anniversary with a charity drive across the nation. It plans to deliver medical aid to one million people and distribute affordable basic foodstuffs.

Writing in Al-Ahram, Egypt's flagship state-run daily, Brotherhood leader Mohamed Badie said the country was in need of "practical, serious competition" to reform the corrupt state left by the Mubarak era.

"The differences of opinion and vision that Egypt is passing through is a characteristic at the core of transitions from dictatorship to democracy, and clearly expresses the variety of Egyptian culture," he wrote.

Mursi's opponents say he and his group are seeking to dominate the post-Mubarak order. They accuse him of showing some of the autocratic impulses of the deposed leader by, for example, driving through the new constitution last month.

"I am taking part in today's marches to reject the warped constitution, the 'Brotherhoodisation' of the state, the attack on the rule of law, and the disregard of the president and his government for the demands for social justice," Amr Hamzawy, a prominent liberal politician, wrote on his Twitter feed.

The Brotherhood says its rivals are failing to respect the rules of the new democracy that put the Islamists in the driving seat via free elections.

Six months into office, Mursi is also being held responsible for an economic crisis caused by two years of turmoil. The Egyptian pound has sunk to record lows against the dollar.

The parties that called for Friday's protests list demands including a complete overhaul of the constitution.

Critics say the constitution, which was approved in a referendum, offers inadequate protection for human rights, grants the president too many privileges and fails to curb the power of a military establishment supreme in the Mubarak era.

Mursi's supporters say enacting the constitution quickly was crucial to restoring stability needed for economic recovery.

(Additional reporting by Ahmed el-Shemi, Ashraf Fahim, Marwa Awad, Shaimaa Fayed and Yasmine Saleh in Cairo and Abdel Rahman Youssef in Alexandria; Writing by Tom Perry; Editing by Robert Woodward)

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Oil prices rise on strong economic indicators

NEW YORK: Oil prices jumped Thursday on greater economic optimism following strong economic indicators in the US, China and Europe.

A barrel of US benchmark West Texas Intermediate futures for delivery in March settled at US$95.95 a barrel on the New York Mercantile Exchange, up 72 cents.

In London, Brent North Sea crude for March delivery ended at US$113.28 a barrel, up 48 cents from Wednesday.

"The economic news from China looked pretty good and this is adding to ... reports suggesting that the global recession is nearing an end, and that is making people more bullish about oil demand," said Michael Lynch of Strategic Energy and Economic Research.

Oil prices have steadily risen since mid-December, gaining more than 12 per cent since Dec. 10.

Figures from British bank HSBC showed China's manufacturing activity in January hitting a two-year high.

"China has been a main driver of oil demand growth for the last decade and (if there is) strong growth, that is a very bullish indicator for the market," said Lynch.

Also Thursday, US jobless claims came in well below expectations, an unexpectedly strong result for the second week in a row.

In Europe, a purchasing managers index, an indicator of manufacturing and services activity, in January reached its highest level in 10 months.

"It is too soon to call this the turn in the European economy, but some are bound to see it that way," said analyst Chris Low of FTN Financial.

The greater optimism came as weekly data from the US Department of Energy pointed to a larger build of oil stockpiles than expected.

The results showed a gain of 2.8 million barrels, whereas analysts had predicted an increase of 1.7 million barrels.

- AFP/jc

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Moral and secular ethics go beyond religious belief: Dalai Lama

JAIPUR: The Dalai Lama on Thursday called for adopting moral and secular ethics, which go beyond the religious belief. The Tibetan spiritual leader told a gathering on the opening day of the Jaipur Literature Festival that one might be a believer or a non-believer, but secular and moral ethics were very important.

He was in conversation with Pico Iyer in a session titled 'Kinships of Faiths: Finding the Middle Way', based largely on his latest book 'Beyond Religion: Ethics for a Whole World'.

"If you do not have interest (in religion), it's OK. Secular ethics are the most important," he said. "Secularism is the base of India's history, her constitution." Secularism did not mean disrespect to any religion, he said. "Accept all religions. Despite the obvious difference between religions and traditions, all religions preach the basic principles of love, faith, truth and trust."

Earlier in his talk, Dalai Lama drew similarities between science and philosophies of Buddha. "Science and Buddhism share the desire to analyze and investigate the truth. Buddha said 'never take my word, challenge it.' The Nalanda masters, whom I often refer to as skilled professors, are always investigating his teachings and have the liberty not accept a teaching if the literal meaning goes against logic," he said, adding that till date, he considered himself a student.

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Penalty could keep smokers out of health overhaul

WASHINGTON (AP) — Millions of smokers could be priced out of health insurance because of tobacco penalties in President Barack Obama's health care law, according to experts who are just now teasing out the potential impact of a little-noted provision in the massive legislation.

The Affordable Care Act — "Obamacare" to its detractors — allows health insurers to charge smokers buying individual policies up to 50 percent higher premiums starting next Jan. 1.

For a 55-year-old smoker, the penalty could reach nearly $4,250 a year. A 60-year-old could wind up paying nearly $5,100 on top of premiums.

Younger smokers could be charged lower penalties under rules proposed last fall by the Obama administration. But older smokers could face a heavy hit on their household budgets at a time in life when smoking-related illnesses tend to emerge.

Workers covered on the job would be able to avoid tobacco penalties by joining smoking cessation programs, because employer plans operate under different rules. But experts say that option is not guaranteed to smokers trying to purchase coverage individually.

Nearly one of every five U.S. adults smokes. That share is higher among lower-income people, who also are more likely to work in jobs that don't come with health insurance and would therefore depend on the new federal health care law. Smoking increases the risk of developing heart disease, lung problems and cancer, contributing to nearly 450,000 deaths a year.

Insurers won't be allowed to charge more under the overhaul for people who are overweight, or have a health condition like a bad back or a heart that skips beats — but they can charge more if a person smokes.

Starting next Jan. 1, the federal health care law will make it possible for people who can't get coverage now to buy private policies, providing tax credits to keep the premiums affordable. Although the law prohibits insurance companies from turning away the sick, the penalties for smokers could have the same effect in many cases, keeping out potentially costly patients.

"We don't want to create barriers for people to get health care coverage," said California state Assemblyman Richard Pan, who is working on a law in his state that would limit insurers' ability to charge smokers more. The federal law allows states to limit or change the smoking penalty.

"We want people who are smoking to get smoking cessation treatment," added Pan, a pediatrician who represents the Sacramento area.

Obama administration officials declined to be interviewed for this article, but a former consumer protection regulator for the government is raising questions.

"If you are an insurer and there is a group of smokers you don't want in your pool, the ones you really don't want are the ones who have been smoking for 20 or 30 years," said Karen Pollitz, an expert on individual health insurance markets with the nonpartisan Kaiser Family Foundation. "You would have the flexibility to discourage them."

Several provisions in the federal health care law work together to leave older smokers with a bleak set of financial options, said Pollitz, formerly deputy director of the Office of Consumer Support in the federal Health and Human Services Department.

First, the law allows insurers to charge older adults up to three times as much as their youngest customers.

Second, the law allows insurers to levy the full 50 percent penalty on older smokers while charging less to younger ones.

And finally, government tax credits that will be available to help pay premiums cannot be used to offset the cost of penalties for smokers.

Here's how the math would work:

Take a hypothetical 60-year-old smoker making $35,000 a year. Estimated premiums for coverage in the new private health insurance markets under Obama's law would total $10,172. That person would be eligible for a tax credit that brings the cost down to $3,325.

But the smoking penalty could add $5,086 to the cost. And since federal tax credits can't be used to offset the penalty, the smoker's total cost for health insurance would be $8,411, or 24 percent of income. That's considered unaffordable under the federal law. The numbers were estimated using the online Kaiser Health Reform Subsidy Calculator.

"The effect of the smoking (penalty) allowed under the law would be that lower-income smokers could not afford health insurance," said Richard Curtis, president of the Institute for Health Policy Solutions, a nonpartisan research group that called attention to the issue with a study about the potential impact in California.

In today's world, insurers can simply turn down a smoker. Under Obama's overhaul, would they actually charge the full 50 percent? After all, workplace anti-smoking programs that use penalties usually charge far less, maybe $75 or $100 a month.

Robert Laszewski, a consultant who previously worked in the insurance industry, says there's a good reason to charge the maximum.

"If you don't charge the 50 percent, your competitor is going to do it, and you are going to get a disproportionate share of the less-healthy older smokers," said Laszewski. "They are going to have to play defense."

___

Online:

Kaiser Health Reform Subsidy Calculator — http://healthreform.kff.org/subsidycalculator.aspx

Read More..