Current Events in October 2010

Increasing levels of debt and bankruptcies are frequently blamed for divorces and conflict within marriage. But new Brigham Young University research suggests that marital woes that can result from financial ups and downs have as much to do with a couple's expectations as their paychecks and credit card bills.

The first-ever study to examine the impact of materialism on marital satisfaction found that highly materialistic spouses are about 40 percent more likely than non materialistic spouses to experience high levels of financial problems, which consequently harm their marital satisfaction. What's more, the impact of materialism held true across all income levels.

"For years there has been an emphasis on learning proper saving and budgeting techniques to avoid marital conflict over financial issues," said Jason Carroll, BYU assistant professor of family life and author of the study, in the new issue of the Family and Consumer Sciences Research Journal. "But our study found that financial problems have as much to do with how we think about money as they do with how we spend money."

Simply put, if you and your spouse don't feel the need to have big houses, fancy cars, and extravagant vacations, then it won't be a problem if you can't afford them.

Carroll's study showed that materialism has an indirect effect on overall marital satisfaction by increasing the frequency of financial problems.

"For a highly materialistic spouse or couple, it takes less financial disturbance to trigger a financial problem," Carroll explained. "Some would say, 'I'm not living a good life and I don't have a good marriage if we can't afford to go on that vacation or purchase designer décor for our home,' where a less materialistic spouse would not view these limitations as a major issue."

The study looked at a nationally representative sample of 600 married couples, selected so that it reflected national averages in terms of ethnic composition, religious affiliation and socioeconomic levels.

All spouses reported their household income level, the degree to which financial matters have been a problem in their relationship, their own level of materialism and their overall level of satisfaction with their marriage.

About 35 percent of the sample reported high levels of materialism, while the remaining 65 percent had low materialism.

Never enough

The materialistic spouses reported more financial problems on average, regardless of income.

Using complex statistical analyses, Carroll's research team found that materialism among one or both spouses was a better way to predict a couple's financial problems than their income. The model also connected this higher level of financial problems with lower marital satisfaction.

"This study suggests that spouses set their own threshold for what they view as a money problem," Carroll said. "If spouses are overly materialistic, their threshold will be quite low, thereby increasing the likelihood that finances will be a problem in their marriages."

Carroll said that materialism may increase financial problems in marriage in two ways:

• A spouse may use money unwisely in chasing unreasonable materialistic expectations, therefore causing actual money problems
• Materialistic expectations may cause a spouse to interpret a financial situation negatively, leading to more complaints and conflicts, even when another couple with similar financial resources won't have such conflicts because of lower expectations.

That's why expectations are a key part to solving money problems in marriage, Carroll said.

"We need to rethink the idea that financial problems are always money problems" he said. "We need to start adjusting how much materialistic issues factor into our idea of what makes a good marriage and family life."

For starters, Carroll gave the following four recommendations:

Separate needs from wants.  It is often said, "Yesterday's luxuries have become today's necessities." In today's consumer culture, it is important for couples to carefully distinguish between their "needs" and their "wants" when it comes to family spending.

Check financial benchmarks.  Many people do not see their financial expectations are too high because they compare their spending habits to others who have more. Couples who typically compare themselves to others who have more than they do frequently develop a sense of entitlement and resentment, while couples who see their situation through the eye of those who have less are more likely to foster a sense of gratitude in their lives.

Focus on the simple. The saying goes, "The most important things in life are not things." While easy to say, this phrase is much harder to live. Financial strain in marriage, brought on by high materialistic expectations, often causes couples to not fully appreciate the simple aspects of their relationship that money cannot buy.

Lower expectations.  Financial problems in marriage are as much about expectations as they are about behaviors. Lowering financial expectations can benefit marriages in two ways. First, spouses will be more willing to avoid making purchases that create debt and stress in their relationship and, second, spouses will be more inclined to interpret their current situation with more gratitude and optimism.

Study coauthor Lukas Dean, who was Carroll's master's student at time of the research, will seek to help couples do that after he completes his Ph.D. in financial counseling at Texas Tech University.

Former BYU research associate Chongming Yang also assisted with the research.

Do you know your credit score? As important as this number is most of us don't really pay attention to it until we're about to borrow a lot money.

Well, according to Smart Money magazine, until recently, a credit score of 680 was considered pretty good which basically meant you paid most of your bills on time, "got dinged" slightly when you went shopped for a refi, but had a good enough credit record to get a loan at the best rates. 

Not anymore. These days 680 is second-tier says Smart Money. Now, you need a credit score of 720 to get large loans on the best terms. That includes one of those 0% interest credit cards with the longest promotion or a jumbo mortgage. It adds that 40-point difference between 680 and 720 will cost you thousands of dollars over the life of a typical loan.

According to Smart Money, there's not much wiggle room either, and that lenders place borrowers into brackets. That means someone with a score of 719 is in the same bracket with someone who has a score of 690.

Informa Research Services says that one point could cost more than $600 over the life of an average 36-month car loan, or $2,500 over the life of a 15-year home equity loan.

Too perfect

Here's an interesting tidbit. Lenders actually prefer you to have a score of 720 than a perfect score of 850. Why? Well, if you have a perfect score, they probably don't make much money off of you. Smart Money says that lenders believe someone with a score of 720 is most likely to repay their debts and least likely to default. At the same time, they're more profitable than people with a perfect score of 850, because they're also likely to carry a balance or incur fees - and therefore, to generate profit for the lender.

The change in what was considered a good credit score apparently happened after the market downturn of 2008 and began when Fannie Mae and Freddie Mac settled on the 720 threshold for the best pricing. Because most mortgages are backed by Fannie or Freddie, the major lenders decided to keep the same threshold.

Obviously, reaching a credit score of 720 is harder than 680, especially with more people out of work and unable to pay their bills. In fact, to have a 720 score, according to Smart Money, you would need low balances on credit cards and a 15-year credit history. You may have been late on a couple payments over the last two years but that's it.

Even someone who regularly pays on time could drop from the mid-700s if he applied for several new credit cards recently. Even those who haven't missed a payment but carry balances that are more than 30% of their credit line could be in jeopardy along with those who have a short credit history but pay on time.

According to John Ulzheimer of Credit.com, if you are right on the edge of 720, you need to be careful because a small differences such as one extra credit inquiry - like when a lender looks up your credit score before approving you for a loan, or if a prospective employer pulls your credit report without telling the credit bureaus it's strictly for employment reasons - could put you under. He says the same thing could happen if you suddenly use more of your available credit because of a large purchase, so make sure you pay it off quickly.

As difficult as it sounds to maintain a 720 credit score, there are some folks who have a near perfect score. According to FICO, the company that designed our current credit model, they are out there.

Craig Watts, senior manager for Public Relations for FICO, told MainStreet.com that while most people score in the middle-to-low 700s on their credit scale, less than 1% of the U.S. population or one million people, do, in fact, net a full score of 850. Watts says they tend to be more conservative and a little older.  

Ulzheimer says you don't need a perfect score to get the best benefits. He says anyone a score above 760, is able to get the same benefits as those with perfect credit.

A score of 760 isn't easy to achieve either. MainStreet.com says that to reach the top tier you have to master not just the basics - maintaining positive payment history and a low debt to credit ratio, but you must pay attention to the details as well. If you want to be among the elite in credit scores, this is what MainStreet advises you to do:

• Have a long and impressive payment history and a clean record
• Maintain a diverse set of accounts, such as mortgages, car loans, revolving credit lines and credit cards
• Have a "well-aged" credit report with a long and stellar credit history
• Have a very limited number of credit inquiries on record, so don't be tempted to open a new store credit card just get 10% off.

Most of the news about  "anxiety over retirement" has been focused on those baby boomers in their 60s and either nearing or entering retirement. But a new survey shows it is the younger boomers, in their 40s, who are really more worried about retirement because of the economic downturn of the past two years. 

The survey by the Allianz Life Insurance Company of Americans found that 44-49 year olds expressed a greater need than their older counterparts in reducing their financial vulnerability and that a majority (54%) felt "totally unprepared" for retirement.

And although they had more time to recover from the market decline, this younger group also showed a greater need than older boomers to take more control of their financial future (47% vs. 35%) and attain more certainty and financial security (41% vs. 30%).

Allianz's "Reclaiming the Future" study also showed that despite this anxiety, only 19 percent of younger boomers are working with professional financial advisors, even though more than half (51%) said they wanted help planning for a stable retirement.

Meanwhile, in a separate survey by the SloanCenter on Aging and Work at BostonCollege, found that 75% of workers 50 and older expect to work during their retirement years. And nearly 10% of retirement-age workers in the study say they "will continue doing the same work until they die."

Interestingly, the study says that was the attitude among works some 60 years ago when more than 45% of men continued to work into their late 60s and beyond. But, over the decades, Social Security and pensions have allowed workers to retire as early as their 50s while maintaining their lifestyles. This changed again when pensions began to disappear.

The SloanCenter on Aging and Work study also found new attitudes about retirement and work:

• 31% of those 50 and older say they would be bored not working.
• 75% say they are interested in phased retirement, though few workplaces offer it.
• 18% those of retirement age say they work to contribute and be productive
• 53% are working for the money.

If you're a boomer looking for work or in retirement and looking for work, the AARP has what are called "Worksearch" offices in their state branches. Funded with a federal grant, the program provides job training and job placement for people 50 and older. These jobs are typically in nonprofit host agencies where they volunteer or work for minimum wage, in exchange for job training, but sometimes this leads to a permanent position with the organization.

Just be aware that those working in retirement often make less money, partly because they work fewer hours. According to AARP, one-third of working retirees put in a workweek of 21 or fewer hours. The typical retiree income is $43,000, about one-third less than that of non-retirees.

Litigation over the recent Meridia recall has already begun in earnest, with a prominent Canadian law firm announcing that it has filed a nationwide class action seeking "financial compensation for anyone in Canada who used Meridia."

"Our Statement of Claim asserts that one of Canada's most commonly prescribed anti-obesity drugs substantially increases a person's risk of a heart attack," said Tony Merchant, the firm's lead attorney, in a statement released last week.

"Merchant Law Group has already been contacted by former Meridia users from Québec, Ontario, and Alberta, many of whom have suffered serious side effects as a result of using Meridia. Our firm has launched nationwide class action litigation with the courts as a result."

A lawsuit was nearly inevitable after Meridia was pulled from the market on October 8 after a clinical trial published in the New England Journal of Medicine showed that it increases users' risk of suffering a heart attack or stroke. The study, which was funded by Meridia manufacturer Abbott Labs, prompted the Journal to write in an editorial that the drug should be pulled off the market.

In withdrawing the drug, the FDA said that Meridia's risks did not justify "the very modest weight loss that people achieve on this drug" -- an average of just five pounds per patient.

A long time coming

Indeed, national consumer advocacy group Public Citizen has been warning since 2002 that Meridia needs to be withdrawn from the market, citing clinical trials from before the drug was approved showing that obese patients taking the drug experienced increased blood pressure, pulse rate and palpatations.

"If the FDA truly intends to operate as a public health agency, then it should acknowledge that the continued approval of this drug cannot be justified based on science," said Dr. Sidney Wolfe, director of Public Citizen's Health Research Group said last year. "The FDA should therefore tell Abbott to pull Meridia from the market immediately."

Meridia was approved by the FDA in 1997 despite clinical trials showing that patients taking the drug were three times as likely to experience electrocardiogram changes as patients on a placebo regimen. The drug was approved in Canada in December 2000. As of March 2003, the FDA had already received reports of 49 cardiovascular deaths in patients taking Meridia, 27 of them in patients under age 50.

Last Wednesday, the Canadian government announced that it was also withdrawing Meridia's generic equivalent -- Apo-sibutramine -- from the market.

Consumers who believe they qualify to participate in the Canadian class action can visit the firm's webpage dedicated to the litigation. The site says that U.S. residents who have been injured by Meridia can email the firm, which will "contact you promptly concerning options available in the United States to seek financial compensation."

The State of Illinois has sued a payday lender, but not for the reason you think.

Illinois Attorney General Lisa Madigan's suit against The Payday Loan Store (PLS) of Illinois, Inc., has nothing to do with predatory lending and everything to do about security. Madigan's suit, filed in Cook County Circuit Court, claims PLS failed to safeguard customer data as promised.

The attorney general filed the suit after learning that documents containing customers' personal information had turned up in trash bins outside four store locations.

"Data security is absolutely critical to protecting consumers from identity theft," Madigan said. "Businesses that collect, use and ultimately dispose of sensitive personal information must live up to their promises to protect that information from unauthorized access in order to protect the financial privacy of consumers."

PLS, which sells high-cost, short-term loans throughout Illinois, provides customers with a privacy policy that promises the company will protect their customers' personal information by maintaining physical, electronic and procedural safeguards in compliance with federal regulations.

Did not maintain safeguards

The state's complaint alleges, however, that PLS did not maintain those safeguards and instead disposed of customers' personal information in publicly accessible trash containers.

The complaint alleges that a concerned individual alerted Bolingbrook, Ill., police that he had found documents containing sensitive information in a trash container behind the PLS location in Bolingbrook. The police retrieved approximately two boxes of documents containing nonpublic personal information, including Social Security numbers, driver's license numbers, financial account numbers and PLS loan account numbers.

"Even in the Internet age, identity thieves continue to steal personal information using relatively low-tech methods, including 'Dumpster diving,' " Madigan said. "It's fortunate that these particular documents ended up with the police instead of in the hands of identity thieves, who could have used the information to wreak havoc on consumers' financial lives."

Madigan's complaint also alleges that PLS regularly told its customers it would comply with federal regulations to guard nonpublic information when in fact PLS did not comply with federal requirements to follow a security program and to take reasonable measures to protect consumer information from unauthorized access when disposing of it.

Madigan is asking the court to permanently bar the defendant from engaging in deceptive and unfair acts and practices. Madigan is seeking to have the defendant pay a civil penalty of $50,000 for each violation of the Consumer Fraud and Deceptive Business Practices Act, additional penalties of $50,000 for each violation committed with the intent to defraud and pay all prosecution costs.

Read more about the Payday Loan Store

Children with unexplained, recurring stomach pains could haven intolerance to fructose, a new study finds.

Unveiled today at the American College of Gastroenterology's (ACG) 75th Annual Scientific meeting in San Antonio, Texas, the study, "Fructose Intolerance/Malabsorption and Recurrent Abdominal Pain in Children," investigated a total of 245 patients with unexplained chronic abdominal pain (alone or associated with constipation, gas or bloating and/or diarrhea) and found 132 to have a sensitivity the monosaccharide.

The patients ranged in age from 2 to 18 years old, with a median age of 11. 150 of the 245 patients were female.

Fructose intolerance is typically diagnosed by exclusion, according to researcher Daniel Lustig, M.D., a pediatric gastroenterologist with the Mary Bridge Children's Hospital and Health Center in Tacoma, WA, who explained that once other GI conditions like Crohn's disease and ulcerative colitis are ruled out, a hydrogen breath test is given to the patient.

If the patient's breath hydrogen exceeds 20 points above baseline, then the patient is likely fructose intolerant.

Breath hydrogen test (BHT) for fructose was performed in all patients in the study and it was positive for fructose intolerance in 132 of 245 patients (53.9 percent). A total of 113 of 245 (46.1 percent) of patients had a negative BHT for fructose intolerance.

All of the 132 patients with a positive BHT for fructose had a nutritional consult with a registered dietician and were placed on a low-fructose diet. Using a standard pain scale for children, 88 of the 132 patients (67.7 percent) reported resolution of symptoms on a low-fructose diet.

Despite the simple fix, cutting fructose from a diet, especially that of a child's or teen's, is easier said than done.

"With fructose in everything from fruit to pre-packaged products, soft drinks and honey, it is difficult to avoid so the challenge is finding those foods without fructose and still maintain a healthy nutritional balance," said Dr. Lustig.

He said fructose intolerance is more prevalent in teenage girls with chronic abdominal pain.

In his practice, Dr. Lustig said he typically sees three or four teenage girls a week with a new diagnosis of fructose intolerance or for follow-up.

"While there is definitely a subset of patients who respond well to a low-fructose diet, it's challenging for patients who are fructose intolerant to maintain, especially teenagers. But the good news is that over half of patients who are fructose intolerant are able to maintain a low-fructose diet and are able to notice an immediate improvement in their symptoms," concluded Dr. Lustig.

Most of us know how important it is to save for retirement and would probably like to save more, but two new surveys released today show that not only are most of us not saving nearly enough, but 8 in 10 say they don't even know where to begin.

Ironically or perhaps on purpose, the separate studies by TIAA-CREF and Bloomberg, arrive just as we begin National Save for Retirement Week.

From the two surveys, here are some of the most interesting findings.

• 39% or nearly 4 in 10 are not saving for retirement at all (TIAA-CREF)
• Only 41% of women feel they will have enough money in retirement compared to 48% of men (Bloomberg)
• 82% admit that they don't know what it takes to save (TIAA-CREF)
• 65% say they will not be able to retire in the manner they had hoped (TIAA-CREF)

According to the TIAA-CREF survey, more than three-quarters of Americans (78%) rely on themselves to make household financial decisions. However, more than half (55%) say do not really know very much about finance. And while many people report buying things on sale and taking other steps to save money, 85% of those surveyed admit to spending the money they save rather than depositing the savings in a financial account.

For those of you who may not know about TIAA-CREF, it's a financial services firm catering to the academic, research, medical and non-profit fields. So they're obviously hoping this survey will wake a few people up and cause them to seek help.

Good luck with that.

Financial behaviorists have said that getting people to save rather than spend is like getting someone addicted to nicotine to quit smoking. You can talk all you want but you practically have to make it illegal before anyone actually changes behavior. Even then, one could point to prohibition and say keep trying.

The key, according to many financial experts, remains letting people continue to work beyond their traditional retirement years. Now if there were only more jobs to allow this to happen. The fact that we still have 9.6 percent unemployment doesn't help.  

The Bloomberg survey polled likely voters to get their findings. Two out of every three women polled believed they would have to work beyond their target retirement age, while only 4 in 10 men felt the same way.

The poll also reflects that women, who have actually been less impacted by layoffs in the past two years, are more concerned about unemployment. Among women voters, 54 percent say unemployment is the biggest issue facing the U.S., compared with 43 percent of men.

Interestingly, the Bloomberg poll finds that more than half of women likely voters approve of the job President Obama is doing and say the economy will either get worse or stay the same if Republicans win control of the Congress. Men, by a margin of 58 percent to 39 percent, disapprove of Obama's job performance on the economy.

Meanwhile, some women poll respondents admitted that they may sit out the upcoming election because the Democrats haven't lived up to the promise of change that fueled the party's victories in the 2008 campaign. 
Maybe they'd change their minds if candidates could show how they would create more jobs.  

A web poll conducted by the National Foundation for Credit Counseling (NFCC) on people's attitudes toward identity theft reveals that 66 percent of more than 1,300 respondents feel at risk.

"In recent years, identity theft has claimed more than 10 million victims per year, and has been the top complaint to the Federal Trade Commission (FTC) for the last five years in a row," said Gail Cunningham, spokeswoman for the NFCC. "ID theft is alive and well, and anyone who doesn't think so is putting themselves at risk of being the next victim."

Of concern are the more than 30 percent of respondents who believe identity theft is declining or think they are immune because they've put one safety tip in place. These people are in definite need of education around identity theft protection, according to NFCC.

Protect Your Identity Week

To help meet that need, the NFCC and the Council of Better Business Bureaus (CBBB) have joined together to host Protect Your Identity Week (PYIW) October17-23.Nearly 200 events are being held in communities nationwide, including free shredding, educational workshops, credit report reviews, and responsible cell phone recycling. Consumers can locate an event near them by going to this map.

Additionally, the site is a resource for prevention tips, victim recovery tips, and includes the Identity Theft Risk Check quiz where individuals can assess their own personal risk of identity theft.

As part of Protect Your Identity Week, Cintas Corporation, national shredding partner for PYIW, is providing free document destruction at events across the country with the goal of making the Guinness Book of World Records for the most paper shredded in a 24-hour period.

A number of national organizations are putting their weight behind the initiative, including, Consumer Federation of America, American Bankers Association Education Foundation, Federal Trade Commission and National Council of La Raza.

The survey says

The actual survey question and results are as follows:

Q: I don't think I'm at risk of being a victim of identity theft because
A. Identity theft is on the decline = one percent
B. My credit card company has systems in place that protect me = nine percent
C.I don't carry my Social Security card in my wallet = 10 percent
D. I never open emails from unknown sources = 15 percent
E. I do think I am at risk of ID theft = 66 percent

The NFCC's September Financial Literacy Opinion Index was conducted via the homepage of the NFCC Web site from September 1-30, 2010 and answered by 1,352 individuals.

After 23 students were hospitalized for alcohol intoxication at the beginning of the Fall semester, Ramapo College in Mahwah, New Jersey banned all alcoholic energy drinks on campus.

While all brands of alcoholic energy drinks are banned, one brand in particular, Four Loko, was called out by name.

The drink, which comes in 23.5 oz cans, in flavors like Fruit Punch, Blue Raspberry, and Cranberry Lemonade, is cheap (about $2.50 each) and has an alcohol content of 12%.

Consuming a whole can of Four Loko apparently produces the same effect as drinking three beers, a can of Red Bull, and a shot of espresso.

Ramapo College is not the first school to ban alcoholic energy drinks. And this is not the first time mixing energy drinks with alcohol has caused concern.

In February 2010, ConsumerAffairs.com reported on a 2008 study done by the University of Florida about the negative effects of mixing alcohol and energy drinks.

In a study of college-aged adults exiting bars, patrons who consumed energy drinks mixed with alcohol had three times the risk of leaving a bar highly intoxicated and were four times more likely to intend to drive after drinking than bar patrons who drank alcohol only.

Which is terrifying when the average breath-alcohol concentration reading for those who mixed alcohol and energy drinks was 0.109, well above the legal driving limit of 0.08.

Study co-author Bruce Goldberger, a professor and director of toxicology in the UF College of Medicine said, "There's a very common misconception that if you drink caffeine with an alcoholic beverage the stimulant effect of the caffeine counteracts the depressant effect of the alcohol and that is not true. We know that caffeine aggravates the degree of intoxication, which can lead to risky behaviors."

In August 2007, ConsumerAffairs.com reported on concern over how alcoholic energy drinks are marketed.

Attorneys general from 28 states appealed to the U.S. Alcohol and Tobacco Tax and Trade Bureau (TTB) to crack down on misleading marketing of alcoholic energy drinks, complaining that the ads suggest they are healthy and are aimed at teenagers and young adults, many of whom are below the legal drinking age.

"Non-alcoholic energy drinks are very popular with today's youth," said Oregon Attorney General Hardy Myers. "Beverage companies are unconscionably appealing to young drinkers with claims about the stimulating properties of alcoholic energy drinks. We urge TTB to take action to stop companies from making misleading claims."

While Four Loko is only sold in liquor stores, one wonders who the manufacturers will hope buys it. The cans are brightly colored; the flavors are fruity and sugary.

Unsurprisingly, it's not just college kids falling victim to the drink. High school students in Mahwah, NJ have been caught with cans of Four Loko, too.

The TV commercial for a chain of motorized wheelchair stores features a geriatric spokesmodel who exclaims, "I didn't pay a penny for my Scooter, Medicare paid it all!"

If that was ever the case, things may be changing. A new law ends the first month purchase option for Medicare patients, as well as expansion of the competitive bidding process to provide equipment to Medicare recipients.

Companies that make and market these high-tech chairs to Medicare patients see the change as a threat. Jay Broadbent, CEO ofSalt Lake City-based Alpine Home Medical, noted that these changes are coming at a time when power mobility providers are already experiencing increasing government audits, delays in reimbursement payments, and reimbursement cuts of more than 35 percent over the last five years.

Provider push-back

"Providers are at the point where we can't endure any more financial pressure and continue to offer quality products and services to Medicare beneficiaries," said Broadbent. "There has to be a realization inWashingtonthat the fallout from the competitive bidding fiasco and elimination of the first-month purchase option is going to have a major impact on Medicare beneficiaries.  There simply are not going to be enough providers left standing to supply them with mobility equipment."

By eliminating the option for the first-month purchase, the government plans to pay providers rental payments over the first 13 months that a patient has the equipment. But with credit tight in the sluggish economy, many providers say they can't obtain the lines of credits and loans they need to afford the upfront cost of purchasing power wheelchairs from manufacturers.

The new law is scheduled to take effect onJanuary 1, but providers are asking Congress to delay implementation for one year so they can have time to adjust their business models to account for the cash flow problems created by the new policy. Currently, Medicare will pay 80 percent of the Medicare-approved amount for a qualifying wheelchair, assuming you have met your Part B deductible and your doctor tells Medicare the wheel chair is medically necessary.

Fraud

The new law comes at a time when Medicare has been cracking down on fraud related to the purchase of power wheelchairs, which can cost thousands of dollars.

Last month the Justice Department announced the guilty pleas of three people in connection with a Medicare fraud scheme operated out of a Houston-area durable medical equipment (DME) company.

In their pleas, the defendants admitted that they were paid kickbacks in exchange for referring Medicare beneficiaries to the DME company, Luant & Odera Inc. Luant & Odera submitted false and fraudulent claims to Medicare for medically unnecessary DME, including power wheelchairs, wheelchair accessories, and motorized scooters.

On its website, Medicare explains its concern with fraud, noting that most doctors, health care providers, suppliers, and private companies who work with Medicare are honest, but a few aren't.

"For example, some suppliers of medical equipment try to cheat the Medicare Program by offering power wheelchairs and scooters to people who don't qualify for these items under Medicare," the agency says. "Medicare is trying harder than ever to find and prevent fraud and abuse by working more closely with health care providers, strengthening oversight, and launching a national program to review claims."

Medicare offers the following red flags when dealing with equipment suppliers:

• Suppliers offer you a free wheelchair or scooter
• Suppliers offer to waive your copayment
• Someone bills Medicare for equipment you never got
• Someone bills Medicare for home medical equipment after it has been returned

The U.S. Food and Drug Administration (FDA) has ruled that an orthopedic device used in the knee should not have been cleared for marketing in the United States.

The determination was announced following a re-evaluation of the scientific evidence that was undertaken after a September 2009 agency report identified problems in the agency's review of the device.

To correct this error, FDA will begin the process to rescind the product's marketing clearance. Before beginning this process, the FDA has asked the product's manufacturer, ReGen Biologics Inc., for a meeting to discuss the appropriate marketing pathway for the device and what data it would need to provide a reasonable assurance of safety and effectiveness.

Initial clearance

FDA cleared the Menaflex Collagen Scaffold for marketing in December 2008 for the repair and reinforcement of the meniscal tissue in the knee. The meniscus is a C-shaped disk of fibrocartilage in the knee that acts as a cushion between the ends of bones in the joint and helps lubricate the joint.

The September 2009 report recommended a scientific re-evaluation of the device because the administrative record did not supply a basis for the FDA's December 2008 decision to clear that was adequate to dispel questions about the role of outside pressures on the review process.

This re-evaluation, initiated in the fall of 2009, included a team of scientists at the agency who were not involved in previous reviews of the device. Another advisory committee meeting was also held in March 2010 (pdf file).

Safety questions

The FDA has now concluded that the Menaflex device is intended to be used for different purposes and is technologically dissimilar from devices already on the market, called "predicate devices." These differences can affect the safety and effectiveness of the Menaflex device.

For example, instead of simply repairing or reinforcing damaged tissue like predicate devices, Menaflex is intended to stimulate the growth of new tissue to replace tissue that was surgically removed. Because of these differences, the Menaflex device should not have been cleared by the agency.

It is unlikely that explanting the device will generally be appropriate or necessary because the device is resorbed and replaced with new tissue. However, patients who have had the Menaflex device implanted should talk with their surgeon or other health care professional about what, if any, steps should be taken.

Manufacturer's options

After implementing a rescission, which revokes a marketing clearance later determined to be erroneous, the FDA prohibits the manufacturer from further U.S. marketing until the agency approves or clears a new marketing application, or grants a classification petition.

After the FDA issues a rescission notice, a manufacturer has the option of requesting a regulatory hearing with the FDA or can choose to voluntarily withdraw their marketing clearance. The device will remain on the market until the agency rescinds its clearance.

The circumstances surrounding the Menaflex device are unique, and FDA's decision in this case does not affect the status of other devices on the market.

This is going to sound like one of those Geico ads, but how would you like to save $500 on your car insurance? This is better than any television ad. This is something you can do on your own without having to listen to some sales pitch from a gecko.

Thanks to U.S. News Report and certified financial planner Joel Ohman, here are seven tips for reducing the cost of your car insurance and you can do it from the comfort of your home.

Tip 1. Review coverage every six months and drop any coverage you don't need

You should review your car insurance coverage every six months or so. Even if it turns out that your current provider is still the best value on the market you may just find out that you are paying for a part of your auto insurance policy that you no longer need.

Not only do insurance rates change quite often but your insurance needs change more often than you may think. If you no longer have a new teenage driver or have changed cars, or have moved to a new zip code, all of these things may potentially cause you to be paying for coverage that you no longer need.

Tip 2. Search for discounts

Never assume that because you searched for all of the car insurance discounts available six months ago that now there are no new discounts that you may be eligible for.

New opportunities for saving money with a car insurance discount program pop up all of the time as different companies announce different discount programs in order to increase their market share.

Tip 3. Improve your credit score

It's no secret that a better credit score will result in better car insurance rates. You may have been working hard to improve your credit score over the last few months in order to qualify for lower interest rates for a home loan or auto loan and you are now starting to see some of your hard work pay off.

When you see an increase in your credit score don't let the opportunity slip by to check and see if this credit score improvement will result in an improvement in your auto insurance rates as well. You worked hard to improve your credit score so why not spend a few minutes to see if that can only help you get a lower interest rate but a lower car insurance rate as well?

Tip 4. Pay your premiums with a credit card

You can cut one to five percent off of your total car insurance premiums just by changing your method of payment.

With the average cash back credit card earning you anywhere from 1 percent to 5 percent cash back that's like getting a bill from your insurance company and then having to only pay 95 percent to 99 percent of the total instead of the full 100 percent!

One to 5 percent may not seem like much but as you can see with a cash back credit card calculator that money can quickly start to add up--depending upon how much money you spend each month if you use that cash back card for many of your purchases then your savings could end up being enough to pay for an entire year of college tuition after 15 to 20 years!

Tip 5. Tell your kids to keep their grades up

Virtually all of the major car insurance companies offer some form of good student discount. If your kids get good grades then you save money. Some companies offer savings for a lackluster C while most offer savings for you that range from 5 percent to 15 percent if your student maintains a B or an A on their report cards.

Tip 6. Take a defensive driving course

OK, maybe you have to leave the house for this one. Signing up for a defensive driving course will take up minimal time and save you money.

Taking a driving course just one time can result in lifetime savings on your car insurance. Check with your car insurance company as to what type of courses and course providers they will recognize for a discount on your policy.

Tip 7. See If Your Occupation Can Save You Money

Did you know that when car insurance actuaries calculate car insurance rates that they actually assign different risk classes to different types of occupations? Some occupations have cheap car insurance rates while other occupations get assigned an added level of risk that increases their rates.

The various occupation risk assessment algorithms will vary from one insurance company to the next but generally speaking professions like engineering and teaching will receive lower car insurance rates than business owners and attorneys.

If you were looking for a good reason to protect your ATM card, the latest news from the California Attorney General's Office provides it.

Authorities have filed charges against three men they say stole $150,000 from consumers' bank accounts, using "skimmers" placed inside gas pumps in Northern California. The episode could give pause to anyone using a debit card at a "pay at the pump" station.

A "skimmer" is an electronic device that intercepts a consumer's debit card information when they swipe it. Sometimes its placed over the real card slot. Sometimes its embedded in the pump itself. If it captures the users credit card number and PIN, the operator can later clean out the unsuspecting consumer's bank account.

"These thieves broke into gas station pumps and installed devices that collected customers' debit and credit card numbers and ATM PINs," Attorney General Jerry Brown said. "Later they used that stolen information to create fraudulent cards, make purchases and withdraw thousands of dollars from victims' accounts."

The three men face 42 counts of felony theft and one count of conspiracy. If convicted on all charges, the three could each face up to 31 years in prison.

"Skimming" scams have been around a long time. In March, the California Attorney General's Office took over prosecution of the case from the Contra Costa District Attorney's office because the crimes occurred in multiple jurisdictions throughout Northern California.

In their high-tech crime spree, the three traveled to gas stations and banks across the Bay Area in a rented Cadillac Escalade. From November 2009 to February 2010, they are believed to have stolen $158,800 from 196 people.

How a "skimming" scam works

To be able to install a device to steal debit card information usually requires access. In this case, Brown says the defendants acquired keys to unlock various kinds of gas station pumps.

Once they opened the pumps, they were able to connect two cables inside to their two-inch electronic device, which looked like a circuit board encased in electrical tape, and recorded ATM and credit card data as well as victims' PINs.

Particularly worrisome is the find that only 40 percent of people in the "work risk" category -- meaning those who care for young children and those who work in residential nursing homes, hospitals, and other health care environments -- said they would definitely get the vaccine this year, which combines the seasonal and the 2009 H1N1 (swine) flus. Twenty-eight percent said they would definitely NOT get the vaccine.

"It's troubling to hear that people caring for young children, including infants, and the elderly are not planning on getting the vaccine" said Orly Avitzur, M.D., medical adviser, Consumer Reports Health.  "These health care workers are among the most likely to catch the disease and spread it to individuals in their care.  And it's no secret that small children and the elderly are at high risk for complications and even death."

Poll highlights and guidance for flu vaccines are available online.

In a bubble

The nationally representative poll, conducted by the Consumer Reports National Research Center, found additional examples of "at risk" populations living in a bubble.

For example, only 45 percent of those considered "at health risk" said they definitely planned on getting the flu vaccine this year.  This category includes people with lung conditions such as asthma, diabetics, people with heart conditions (except hypertension), those with immune system problems, and those with neurological or neuromuscular disease.  All of these conditions are linked to an increased likelihood of flu-related complications.  

"We suspect that part of the problem involves a lack of understanding of one's own health risks -- in fact, only 42 percent of those at health risk for flu complications described themselves as such," said Dr. Avitzur.

Only 51 percent of those in the "age-risk" category (i.e. those who are 65 and older) said they would definitely get the combined vaccine.  About one-third (33 percent) of those 65 and older believed they were at high risk of seasonal flu complications.

Vaccine worries

Reasons for not getting this year's vaccine lead with the belief that the swine flu epidemic was overblown last year (45 percent), followed by concerns about side effects (44 percent) and safety of the vaccine (41 percent).  Nearly one-third (28 percent) said they believed the vaccine doesn't work.

Some other poll highlights:

-- Overall, only 37 percent of those polled said they would definitely get the combined vaccine this year while 31 percent said it depends.  Thirty percent said they will definitely NOT get the vaccine this year.
-- Of those who did not get the seasonal flu vaccine last year, the top reason was the mistaken belief that it's best to build one's own natural immunities.   "We encourage every American to get this year's combined seasonal and 2009 H1N1 (swine) flu vaccine," said Dr. Avitzur.
--  Men were more likely than women (46 percent versus 35 percent) to cite "I do not get the flu" as a reason for not getting the flu vaccine.   Overall, 41 percent cited this excuse, a significant drop from the 54 percent who provided the same rationale in 2008, suggesting that more people are getting the message that they can't count on being immune to the flu.
--  When it comes to confidence in the safety of the combined vaccine, 69 percent said they were very or somewhat confident in the safety of the 2010 flu vaccine. By comparison, 62 percent were confident in the last year's H1N1 vaccine.  But overall, 25 percent were not too confident or not confident at all in the safety of the vaccine.
--  Those on the fence about getting this year's vaccine cited the following factors that might influence their plans this year:

•  Advice from their health-care provider (73 percent)
•  Reports about outbreaks in the community (62 percent)
•  Guidelines or warnings from local or state health departments and/or federal agencies such as the Surgeon General or Centers for Disease Control and Prevention (57 percent).

On a positive note, 58 percent of parents had their children vaccinated for seasonal flu last year, compared to only 41 percent in 2008. 

More good news: the majority of people (66 percent) told Consumer Reports Health that last year the swine shot and/or nasal vaccine was administered at no charge.  

And, in another sign that cost is not an impediment, only a small number (12 percent) cited cost as a reason for not getting the seasonal flu shot last year.

The U.S. Food and Drug Administration (FDA) today warned eight companies that their over-the-counter (OTC) chelation products are unapproved drugs and devices and that it is a violation of federal law to make unproven claims about these products. There are no FDA-approved OTC chelation products.

The companies that received the warning letters claim that their products treat a range of diseases by removing toxic metals from the body.

Some also claim to treat autism spectrum disorder, cardiovascular diseases, Parkinson's disease, Alzheimer's disease, macular degeneration, and other serious conditions. Some companies that received the warning letters also claim their products will detect the presence of heavy metals to justify the need for chelation therapy.

The drug products involved have not been evaluated by the FDA for treatment of these diseases, and violate the Federal Food, Drug, and Cosmetic Act (FFDCA), the agency said. Despite the claims of the companies that received warning letters, the effectiveness in treating any of the diseases listed is unsubstantiated.

Depending on the condition, when relying on unproven OTC chelation products to treat serious conditions, patients may delay seeking effective medical care.

In addition, the FDA said there are serious safety issues associated with chelation products, which can alter the levels of certain substances in the blood.  Even when used under medical supervision, these products can cause serious harm, including dehydration, kidney failure, and death.  

"These products are dangerously misleading because they are targeted to patients with serious conditions and limited treatment options," said Deborah Autor, director of the Office of Compliance in the FDA's Center for Drug Evaluation and Research. "The FDA must take a firm stand against companies who prey on the vulnerability of patients seeking hope and relief."

The agency advises consumers to avoid non-prescription products offered for chelation or detoxification.

The only FDA-approved chelating agents are available by prescription only and are approved for use in specific indications such as lead poisoning and iron overload. Procedures involving these agents carry significant risks and should be performed only under medical supervision.

The FDA has noted an increase in "chelation therapy" products marketed on the Internet that claim to cleanse the body of toxic chemicals and heavy metals. Although some of the products are marketed as dietary supplements, they are unapproved drugs because they claim to treat, mitigate, prevent, or diagnose disease. The products come in various dosage forms, including transmucosal sprays, suppositories, capsules, liquid drops, and clay baths.

Some of the companies also sell unapproved screening tests that claim to detect the presence of heavy metals in urine to justify the need for chelation therapy.

"FDA will seek enforcement action against companies that promote therapeutic benefits of products not yet evaluated by the agency for safety and effectiveness." said Dara A. Corrigan, associate commissioner for Regulatory Affairs.

Under the FFDCA, companies that market products that claim to prevent, diagnose, treat or cure diseases must file an application with the FDA and provide data that demonstrate their products' safety and effectiveness.

The companies must take prompt action to correct the legal violations cited in the warnings letters or face possible legal action, including seizure and injunction. The FDA issued warning letters to the following companies:

• World Health Products, LLC: Detoxamin Oral, Detoxamin Suppositories, and the Metal Detector test kit

• Hormonal Health, LLC and World Health Products, LLC: Kelatox Suppositories, and the METALDETECTOR Instant Toxic Metals Test

• Evenbetternow, LLC: Kids Chelat Heavy Metal Chelator, Bio-Chelat Heavy Metal Chelator, Behavior Balance DMG Liquid, AlkaLife Alkaline Drops, NutriBiotic Grapefruit Seed Extract, Natur-Leaf, Kids Clear Detoxifying Clay Baths, EBN Detoxifying Bentonite Clay, and the Heavy Metal Screen Test

• Maxam Nutraceutics/Maxam Laboratories: PCA-Rx, PC3x, AFX, AD-Rx, AN-Rx, Anavone, AV-Rx, BioGuard, BSAID, CF-Rx, CreOcell, Dermatotropin, Endotropin, GTF-Rx, IM-Rx, Keto-Plex, Natural Passion, NG-Rx, NX-Rx, OR-Rx, Oxy-Charge, PN-Rx, Ultra-AV, Ultra Pure Yohimbe, and the Heavy Metal Screening Test

• Cardio Renew, Inc: CardioRenew and CardioRestore

• Artery Health Institute, LLC: Advanced Formula EDTA Oral Chelation

• Longevity Plus: Beyond Chelation Improved, EndoKinase, Viral Defense, Wobenzym-N

• Dr. Rhonda Henry: Cardio Chelate (H-870)

Healthcare professionals and patients are encouraged to report adverse events or side effects related to the use of these products to the FDA's MedWatch Safety Information and Adverse Event Reporting Program:

• Complete and submit the report online: www.fda.gov/MedWatch/report.htm

• Download form or call 1-800-332-1088 to request a reporting form, then complete and return to the address on the pre-addressed form, or submit by fax to 1-800-FDA-0178
  

 Early next year, Indiana lawmakers will consider a proposal to require workers in nursing homes to undergo background checks, in an effort to provide better protection for vulnerable elderly residents.

Indiana Attorney General Greg Zoeller said he will also propose that the legislature make additional changes in state law to provide whistleblowers with legal protections. More broadly, Zoeller has asked an oversight panel that reviews licensing agencies to focus its scrutiny on the Indiana Health Facility Administrator (HFA) Board, the body that has disciplinary power over nursing home administrators.

"The HFA Board writes the licensing rules for nursing home administrators and the board acts as judge and jury to decide whether or not those rules were violated," Zoeller said."We have an opportunity through this evaluation committee to thoroughly examine the rule-enforcing process by the group of experts the Legislature created for that purpose, to determine if it is adequate to hold these licensees accountable for violations within the facility that occur on their watch."

Abuse toll

According to the best available estimates, between one and two million Americans age 65 or older have been injured, exploited, or otherwise mistreated by someone on whom they depended for care or protection, according to the National Center on Elder Abuse.

Nursing Home Abuse Resource, an advocacy group, says 30 percent of nursing home facilities in the U.S. are cited for instances of abuse. The group maintains that the majority of all nursing home abuse incidents are never reported.

Zoeller sent a letter to the Regulated Occupations Evaluation Committee, a newly-created oversight panel already assigned to review the authority and duties of licensing boards that issue professional licenses in Indiana. Zoeller's letter asked the committee to review first the HFA Board, its standards of practice, the rules it has written for nursing home administrators and its oversight of that profession.

Established when the Legislature passed Senate Enrolled Act 356 in April, the Regulated Occupations Evaluation Committee can recommend changes in state law to lawmakers. The committee agreed today to conduct a hearing on the HFA Board in January.

Separate from the committee's review, the Attorney General is proposing his own recommendations to the Legislature to consider in its 2011 session.

Enhanced screening

 To screen out individuals with criminal records from working around the vulnerable elderly, Zoeller supports legislation authored by Indiana State Senator Patricia Miller of Indianapolis, to require health professionals who work in nursing homes - such as nurses and administrators - to undergo criminal background checks when they apply for a license. 

Paid for at licensees' expense, the background checks would be sent to the Indiana Professional Licensing Agency (IPLA), which oversees licensing records for nurses and administrators. Also, county prosecutors would be required to notify IPLA if a health licensee is convicted of or pleads guilty to a crime, since a criminal conviction could be grounds for suspension or revocation of a health license.

Zoeller says he is also proposing that legislators change state law to extend whistleblower protections to nursing home administrators and staff who report misconduct. State law already protects whistleblowers who report health and safety violations from employment-related retaliation; and those who report Medicaid fraud can receive a portion of Medicaid's civil recovery. Zoeller proposes widening the existing legal protections to include whistleblowers, to encourage those aware of misconduct to report it.

Notice of termination

Zoeller said he also wants to change Indiana law so that nursing homes are required to notify the State whenever they terminate a licensed health care giver. Nursing homes would have to report terminations to the IPLA and to the responsible licensing boards. 

Zoeller also recommends that the Legislature require insurance companies to report to the State any judgments or settlements they pay out involving nursing home negligence.

Between 2005 and this year, the Medical Licensing Section of the Attorney General's Office filed 34 administrative complaints against Indiana nursing home administrators for various regulatory violations and obtained disciplinary actions from the HFA Board on 25 of them, with one currently pending. 

For many employed Americans, the 401(k) has replaced the pension as the primary source of their retirement savings. In many cases, it represents their entire retirement savings, so it's important to make sure it is performing at a level that will provide the nest egg you're hoping for.

Most of us just assume that when it comes to our 401(k), everything is all right. Each pay period, our company takes out a percentage of pre-tax wages, possibly matches the contribution, and deposits it into our 401(k) account. But how often do we check that account to make sure the return is what you were expecting? What? You said "never."

You're not alone. In the business they call it "inertia." Before 401(k) contributions became automatic "inertia" was considered the main culprit keeping employees from signing up. Today, 401(k) contributions are usually automatic. That same inertia now has more workers contributing to 401(k) plans because if you do nothing money is automatically deducted from your pay and deposited in a 401(k) account. To get out of it you have to take action, and most people don't. Now the problem with inertia is that people remain too complacent when it comes to what that money is invested in.

You should know that by next year it will be easier to figure out how much your plan is charging you, whether that fund you're pouring money into each month is still aligned with your goals, and who you can turn to for investment advice. But until then, you have to do the digging yourself.

Start by making sure you have a plan that fits your personality, whether you need hand-holding or prefer to go it alone. If your plan falls short, talk to your boss to see if he or she can improve it. A few small changes in how you save and invest your money today can make a huge difference in your future nest egg.

Here are some other key questions:

Q: Is my 401(k) is any good?

Your plan should offer a well-diversified mix of low-cost investment choices. An employer match is a plus because employees tend to save more when their company kicks in money. Investment guidance and regular, personalized report cards to show you whether you're on track are important parts of a great 401(k) plan.

Q: What's the right investment mix?

Make sure your investment mix matches your risk tolerance. Most plans have funds that range from aggressive-growth funds to income funds for those employees near retirement.

Q: How much of your salary should you save?

Probably more than you're saving now. Most employees are saving 7% a year or less, and employers are offering matching contributions of another 3-4% of pay. That adds up to about 10% which isn't going to be enough. Try to save about 15% of your gross salary, including any employer contribution.

Karen Blumenthal of The Wall Street Journal offers five common 401(k) mistakes and adjustments you can make to keep your retirement plans on track:

Mistake No. 1: Thinking the most important decision is how you invest your money.

Many of us agonize over selecting just the right funds or whether to put 50% or 65% into stocks. Sure, asset allocation can have an impact on your bottom line, though it is partly a game of luck, depending on whether you catch a rally in one sector or another. Your first priority, though, should be determining how much you need to save—and figuring out how to make that happen.

Unfortunately, compared with debating mutual funds, savings "is so unsexy that nobody wants to talk about it," says Mike Alfred, chief executive of Brightscope Inc., which rates 401(k) plans.

The average participant saves 7% to 8% of pay, but many retirement-plan advisers recommend you aim for 10% or more, before including your employer match. Under Internal Revenue Service rules, you can contribute as much as $16,500 to your 401(k) this year, plus an additional $5,500 if you are 50 or older. If you want to be more exact, try using an online financial-planning tool, such as the Economic Security Planner (basic.esplanner.com).

Mistake No. 2: Investing only enough to get the company match.

You don't want to leave any money on the table, so you definitely want to collect whatever the company is offering. But in reality, it may not be that great a deal. Some companies eliminated the match in the last downturn, and many haven't restored it.

Much more common—and much less discussed—is that many companies make that match hard to collect. Matches take up to six years to vest at 60% of the companies surveyed by the Profit Sharing/401k Council and half of those surveyed by Hewitt Associates, a human-resources consulting firm that recently became Aon Hewitt, a unit of Aon. In some cases, you may not receive any of the match for as long as three years, or you may get only a fraction of the match each year for six years.

Given the uncertain job market, it can be dicey to count on collecting your share. Instead, save for your future and maximize the tax advantage of contributing to the plan.

Mistake No. 3: Assuming your 401(k) can be invested for you alone because it is for your retirement.

If you are married, don't assume your investments are just for you. Many people choose investments without weighing what their spouse is doing or what other stocks or bonds they own. Retirement-planning software offered by many firms rarely ask how other family funds are invested.

Yet all of your savings will play a role in your future comfort. So at least once a year, you should put your investments and your spouse's together and make adjustments. If your spouse's plan has better international-fund options, your spouse could invest more heavily in those while you put more in bonds. If you haven't done this before, you may find it as much an exercise in trust as in investing.

Mistake No. 4: Investing too much in your company's stock—even after Enron and Lehman Brothers.

Last year, just 17% of companies matched employee contributions with company stock, down from 36% in 2005, according a survey by Hewitt. In addition, employees today can usually diversify those shares at any time; in 2005, more than half of the plans didn't offer that flexibility.

Still, Hewitt found that when company stock was an option, 21% of retirement-plan holdings were invested in it, an exceedingly large allocation to a single stock.

If you have ignored your company-stock holdings, now may be the time to diversify. Vanguard recommends that your company stock shouldn't make up more than 10% of your retirement-plan money.

Mistake No. 5: Picking funds based on performance alone.

Stock and bond returns are largely unpredictable. But the one factor that is predictable is the expense rate. When deciding which funds to invest in, zero in on the ones with the lowest expenses.

The impact could surprise you. A recent Hewitt analysis found that cutting investment fees by 25 basis points—or $25 per $10,000 investment—could have the same effect as receiving an extra half-percentage-point match from your employer over your career

A new Consumer Reports survey conducted just last month found that, in the past 12 months, a whopping one in five CR Online subscribers received a bill that was significantly higher than they expected.

Doesn't add up

That figure is at odds with what big cell carriers said when the magazine reported about this issue only last May -- before CR had its own survey data. "I can tell you that it's a very, very small percentage," Nancy Stark, a Verizon spokeswoman, told Consumer Reports. "It's a very, very, very low percentage," said Mark Siegel, an AT&T spokesman.

Also, a Federal Communications Commission (FCC) survey discovered a smaller incidence than was found among CR readers: Just one person in six is ever bill-shocked, according to the FCC survey. The surprise bills for a third of the FCC group were at least $50, while they were $100 or more for 23 percent.

Corrective action

Now the FCC is proposing that carriers be required to send customers an alert before they run up an overage tab - something carriers oppose, according to The Wall Street Journal. AT&T and Verizon Wireless did not immediately respond to requests for comment.

Consumers Union (CU), the publisher of Consumer Reports, supports the FCC proposal. "People should not be blindsided by these surprise charges on their bill," said Ellen Bloom, senior director of federal policy and Consumers Union's Washington, D.C., office, after the FCC's announcement of its proposal. "We think that's wrong, and we are worried that the problem is getting worse."

Bloom says that at a minimum, CU supports providing all consumers with free and timely "usage alerts." Consumers should know when they are getting close to a specified limit on data service, or they are about to run up steep roaming charges. "We also think it is critical for consumers to know how much they will be charged for going over their allotted time," said Bloom.

Nothing new

Cell phone bill shock has a long and ugly history. Back in 2005, Ed of Houston told ConsumerAffairs.com that his 68-year-old mother received a warranty replacement phone, from Cingular Wireless, for her defective Motorola phone. "After using the phone for a little over a month, she received her bill. It was for a whopping GRAND! $1000! ONE THOUSAND DOLLARS!" Her phone bill is usually somewhere around $80.

Ed says he learned she was being charged because her new Motorola flip phone did not hang up her calls when she closed it like her old Motorola flip phone. Apparently the phone also did not naturally hang up after either caller terminated the conversation. "Needless to say," Ed concludes, "she wound up being charged far more than the time she actually spent talking -- to the tune of some $900."

Howard of Madison, WI, wrote us in 2008 that "Since Oct 2007, I have received cell phone bills for more than $1000.00 a month from Sprint when my normal bill should be roughly 70.00 per month. I have called repeatedly and gotten promises that there would be credits and that they would correct the problems that caused my issues. (They are charging me for Text messaging and Data usage when I have unlimited for both!)"

But, he notes, "I have spent more than $4000 in cell phone bills since Oct 2007, and Sprint has done little to merely credit me for text usage and data usage. These are the only two elements that are being impacted, but both have cost me dearly."

FCC rules

As part of its announcement, the FCC suggested the following rules for wireless carriers to help prevent their customers from experiencing bill shock:

Over-the-Limit Alerts: Consumers that have limited bundles of voice, text, and/or data can incur expensive overage charges when their cap is exceeded. Without constant monitoring, these charges quickly add up -- particularly with "family plans" where multiple people share the same bundle.
The FCC's proposed rules would require customer notification, such as voice or text alerts, when approaching and having reached monthly limits that will result in overage charges.

Out-of-the-Country Alerts: Many American customers don't know that their "unlimited" minutes, texts, or data plans only cover use within U.S. borders. Consumers can see their bills skyrocket when they travel abroad because of the additional fees for "roaming" on a foreign mobile network.

The FCC's proposed rules would require mobile providers to notify customer when they are about to incur international or other roaming charges that are not covered by their monthly plans, and if they will be charged at higher-than-normal rates.

Easy-to-Find Tools: Many wireless providers use some technological tools to alert consumers about their bills. For example, iPad users automatically receive text alerts when they are about to go over their data limits. But these tools are not widely available and too many consumers don't know about them.

The FCC's proposed rules would require clear disclosure of any tools offered by mobile providers to set usage limits or review usage balances. The FCC is also asking whether all carriers should be required to offer the option of capping usage based on limits set by the consumer.

 Simply walking every day could help you retain more of your memory function later in life, according to a researcher at the University of Pittsburgh. However, it means doing a lot of walking.

Kirk I. Erickson, an assistant professor of psychology at the University of Pittsburgh and lead author of the study, says walking six miles a week could help the brain retain its size as individuals age. The study followed 299 older people who kept track of their walking distances.

 After a nine-year period, the subjects underwent brain scans to measure brain size. They were also tested for Alzheimer's disease and other forms of memory impairment, from mild to severe. Those who walked at least six miles each week were found to have more brain mass than those who walked less.

 Erickson says the findings are encouraging because they point to simple, inexpensive steps individuals can take to ward off dementia.

"Just by walking regularly, and so maintaining a little bit of moderate physical activity, you can reduce your likelihood of developing Alzheimer's disease and spare brain tissue," he said.

Celery, peppers and carrots

Other recent research points to additional easy steps to maintain memory function. Researchers writing in the Journal of Nutrition report a diet rich in the plant compound luteolin reduces age-related inflammation in the brain and related memory deficits by directly inhibiting the release of inflammatory molecules in the brain, researchers report.

Luteolin is found in many plants, including carrots, peppers, celery, olive oil, peppermint, rosemary and chamomile.

The researchers focused on microglial cells, specialized immune cells that reside in the brain and spinal cord. Infections stimulate microglia to produce signaling molecules, called cytokines, which spur a cascade of chemical changes in the brain.

Some of these signaling molecules, the inflammatory cytokines, induce "sickness behavior": the sleepiness, loss of appetite, memory deficits and depressive behaviors that often accompany illness.

Inflammation

"We found previously that during normal aging, microglial cells become dysregulated and begin producing excessive levels of inflammatory cytokines," said University of Illinois animal sciences professor Rodney Johnson. "We think this contributes to cognitive aging and is a predisposing factor for the development of neurodegenerative diseases."

Johnson has spent nearly a decade studying the anti-inflammatory properties of nutrients and various bioactive plant compounds, including luteolin. Previous studies - by Johnson's lab and others - have shown that luteolin has anti-inflammatory effects in the body. This is the first study to suggest, however, that luteolin improves cognitive health by acting directly on the microglial cells to reduce their production of inflammatory cytokines in the brain.