Current Events in November 2016

As we have recently seen, everyday devices that connect to the internet – the so-called Internet of Things (IoT) -- are vulnerable to cyber-attack.

Last month, a hacker harnessed tens of millions of these devices to launch denial of service attacks that temporarily blocked access to major web destinations like Amazon, Netflix, and Twitter.

Apparently, it wasn't that hard to do. These devices, for the most part, are largely unprotected by security software. How many IoT devices are in your home? Probably a lot more than you think.

The IoT includes things like your router, your DVR, and your printers. But it might also include your refrigerator, smart lighting system, and your thermostat.

Invasion of the botnets

A clever hacker can easily penetrate these devices and insert a botnet, ready to take over the device and follow the hacker's orders. Botnets have taken over PCs for years, using them to send out spam emails. Now that they can seize millions of other devices, they are even more of a threat.

Security Intelligence, a cyber-security publiction, raised the IoT security issue two years ago. Back then, it pointed to several potential pitfalls.

First, with so many devices – and some estimates predict 30 billion connected devices by 2020 – it will be next to impossible keeping security on them up to date.

Because there will be so much data moving through the IoT, how do you tell the good data from the potentially harmful data? And with companies using proprietary implementations, it could make it harder to find hidden or unknown zero-day attacks.

What to do

While there are step consumers can take to make their IoT more secure, California Attorney General Kamala Harris says manufacturers of these devices have not done a good job of telling consumers how to do it. A first step, she says, is for consumers to change the default passwords for any and all devices that connect to the internet.

To do that, find the default login information in the user manual, or in some cases, on the device itself. If it isn't obvious, do an online search for “default router, DVR, or webcam username and password,” then check for the name and model of your device.

You then use the default log-in to access your account and change the password.

Ultimately, Harris says manufacturers need to do a better job of making their devices more secure to start with, and regularly updating their security protection.

We've heard for years that Black Friday is the biggest shopping day of the year and that consumers eagerly look forward to participating. But really? Do people really enjoy standing in line outside a Walmart at 4:00 a.m.?

Our friends at BestBlackFriday.com have stumbled across the painful truth. A survey conducted for the site by SurveyMonkey found a sizable number of consumers actually claim to hate Black Friday.

According to the results, fewer than 15% of those questioned actually “love” the official kick-off to the holiday shopping season. A little over 35% profess to hate it. About half of those in the survey describe Black Friday as “just okay.”

A young person's game

Other takeaways from the survey – younger shoppers tend to “love” Black Friday more than older people. There is a huge drop in affection after Americans turn 30. Consumers who say they hate Thanksgiving openings also hate Black Friday.

Is it possible consumers are just burned out on Black Friday hype? Phil Dengle, a principal at BestBlackFriday, says that's a logical explanation. Also, he says consumers no longer have to get up early and fight the crowds in order to get a good buy.

“The numerous pre-Black Friday and early November sales are absolutely turning shoppers off to the actual day of Black Friday.,” Dengler said in an email to ConsumerAffairs.

As of November 7, Dengler notes that Amazon had already opened its "Black Friday Store," and retailers like Walmart have been showcasing Early Bird Online Specials.

“Actual Black Friday doorbusters will start on the Wednesday before Thanksgiving this year, so everything is much more spread out,” he said. “Overall, prices are still going to be better on Thanksgiving, Black Friday, and Cyber Monday, but it is still more than possible to find great deals in the weeks leading up.”

More online shopping

And the week after too. Research has shown year after year that overall, the best deals aren't found on Black Friday but in early December. And more and more sales are being conducted online. The significant drop in the number of major retailers open this Thanksgiving probably has less to do with perceived public backlash than with the fact shoppers can still buy things from the comfort of their living rooms between dinner and football.

Plus, Dengler says there are now so many deals, before and after Black Friday, consumers are not obsessed with getting the absolute lowest price.

“Many shoppers just do not want to go through with the hassle and stress of shopping on Thanksgiving and Black Friday, so they are sacrificing a few dollars to get it on their own terms,” he said.

Finally, the survey suggests this Black Friday might find the stores not so crowded. Forty percent said they didn't plan to shop at all the day after Thanksgiving and 28% said they would limit their shopping to online.

Even though there was little change in the number of job openings during September, there were fewer people added to payrolls than in August.

The Labor Department's Bureau of Labor Statistics (BLS) reports the number of people who found work dipped to 5.1 million, while the number of job openings was fairly steady at 5.5 million.

With a hires rate of 3.5%, the number of hires was little changed for total private and for government, fell in arts, entertainment, and recreation, and showed little change in all other industries. Hiring was down in the Northeast region and steady in all other regions.

Separations

Total separations, or turnover, includes quits, layoffs & discharges, and other separations.

September saw 4.9 million total separations, about the same as August, for a rate of 3.4%. The total was essentially unchanged for private and for government, but increased in transportation, warehousing, and utilities. Separations decreased in arts, entertainment, and recreation (-55,000), and the total number was little changed in all four regions.

The number of quits was little changed in September (3.1 million), and the quits rate was 2.1%. The number of quits was little changed for total private, and increased for government. The number of quits was little changed in all four regions.

Layoffs and discharges totaled 1.5 million in September, down 218,000 from August, with a rare dip to 1.0%. The number of layoffs and discharges decreased for total private and for government, and was down in the South.

The other separations category was little changed for total nonfarm, total private, government, and in all four regions.

Net change

For the year ending in September, hires totaled 62.7 million and separations totaled 60.1 million, for a net employment gain of 2.6 million. This includes workers who may have been hired and separated more than once during the year.

The complete report is available on the BLS website.

The market for 55+ housing continued to perk along in the third quarter.

According to the National Association of Home Builders (NAHB), its 55+ Housing Market Index (HMI) rose two points in the July-September period for a reading of 59. That marks the 10th consecutive quarter with a reading above 50, which indicates that more builders view conditions as good than poor.

"The 55+ housing market continues on a steady path toward recovery, much like the overall housing market," said NAHB Chief Economist Robert Dietz. "Older homeowners are able to take advantage of low mortgage rates and rising home prices, enabling them to sell their current homes and buy or rent a home in a 55+ community."

Gauging the market

There are separate 55+ HMIs for two segments of the 55+ housing market: single-family homes and multifamily condominiums. Each 55+ HMI measures builder sentiment based on a survey that asks if current sales, prospective buyer traffic, and anticipated six-month sales for that market are good, fair, or poor (high, average, or low for traffic).

Two of the three index components of the 55+ single-family HMI posted an increase from the previous quarter: Present sales rose two points to 63 and traffic of prospective buyers rose five points to 47. Expected sales for the next six months dropped four points to 65.

The 55+ multifamily condo HMI rose one point to 48. The index component for present sales was up two points to 51, while expected sales for the next six months fell three points to 51 and traffic of prospective buyers was unchanged at 38.

All four indices tracking production and demand of 55+ multifamily rentals decreased in the third quarter. Present production fell three points to 48, expected future production decreased seven points to 49, current demand for existing units dropped nine points to 59, and future demand fell eight points to 59.

"Builders and developers for the 55+ housing sector tell us that business is solid right now and they expect that trend to continue through the rest of the year," said Jim Chapman, chairman of NAHB's 55+ Housing Industry Council and president of Jim Chapman Homes LLC in Atlanta.

General Motors is recalling 18 model year 2016 Chevrolet Malibus manufactured November 18, 2015, to June 7, 2016.

The fabric of the side-impact airbag cushion may tear during deployment.

If the airbag tears during deployment, it may not perform as designed, increasing the risk of injury in the event of a crash.

What to do

GM will notify owners, and dealers will inspect and, as necessary, replace the air bag module, free of charge. The recall began October 27, 2016.

Owners may contact Chevrolet customer service at 1-800-222-1020. GM's number for this recall is 16079.

Chrysler (FCA US LLC) is recalling 88 model year 2017 Jeep Cherokees manufactured October 13, 2016, to October 17, 2016.

Improper welds on the driver's knee airbag inflator may prevent the airbag from inflating properly, increasing the risk of injury in the event of a crash.

What to do

Chrysler will notify owners, and dealers will replace the driver's knee air bag module, free of charge. The recall is expected to begin November 18, 2016.

Owners may contact Chrysler customer service at 1-800-853-1403. Chrysler's number for this recall is S84.

It's hard to find a processed food that does not contain emulsifiers, additives that are used to extend shelf life and improve texture. Now, a new study finds that emulsifiers can promote intestinal inflammation and colorectal cancer, the fourth-leading cause of cancer deaths.

Researchers at Georgia State University say they found that regular consumption of emulsifiers by mice altered intestinal bacteria in a way that contributed to tumor development. 

Colorectal cancer caused about 700,000 deaths per year in the United States in 2012, the last year for which complete figures are available. And researchers note that the increasing death toll roughly corresponds to the rise of processed food consumption. 

"The incidence of colorectal cancer has been markedly increasing since the mid-20th century," said Dr. Emilie Viennois, assistant professor in the Georgia State Institute for Biomedical Sciences. "A key feature of this disease is the presence of an altered intestinal microbiota that creates a favorable niche for tumorigenesis."

"Pivotal role"

"The dramatic increase in these diseases has occurred amidst constant human genetics, suggesting a pivotal role for an environmental factor," said Benoit Chassaing, assistant professor in the Institute for Biomedical Sciences.

Earlier studies by the Georgia State research team suggested that low-grade inflammation in the intestine is promoted by consumption of dietary emulsifiers, which are detergent-like molecules incorporated into most processed foods that alter the composition of gut microbiota.

The addition of emulsifiers to food seems to fit the time frame surrounding colotrectal cancer. Viennois and Chassaing hypothesized that emulsifiers might affect the gut microbiota in a way that promotes colorectal cancer. They designed experiments in mice to test this possibility.

In the latest study, the team fed mice with two very commonly used emulsifiers, polysorbate 80 and carboxymethylcellulose, at doses seeking to model the broad consumption of the numerous emulsifiers that are incorporated into the majority of processed foods.

They found drastic changes in the gut microbiota in a manner that made it more pro-inflammatory, creating a niche favoring cancer induction and development.

The findings were published in the journal Cancer Research. 

The time when the nation will decide who will become the next President of the United States is nearly upon us. Regardless of your political or ideological leanings, registered voters across the country should get out and make their voices heard on Tuesday. However, there are many that might be worried about how they'll get to the polls. 

Luckily, several companies plan on making the trip to your local polling place a little easier. Ride-sharing companies Uber, Lyft, and Zipcar are all offering unique deals on election day for consumers who need a ride to get out the vote.

Uber teams with Google

Uber has teamed up with Google to provide an in-app feature that helps users locate their polling place and get there. Just click on the “Find Your Polling Place” button in the app and you can see a list of Google-generated sites nearby.

Uber will be setting reminders in its app for consumers to get out and vote all day election day. For those who have never used Uber and will be requesting a ride, entering the code VOTETODAY will get you $20 off on your trip.

“Given the important decision people around the country will make on November 8^th, we wanted to make getting to and from your polling place easier than ever,” the company said in a blog post.

Lyft and Zipcar deals

Lyft will also be offering users a discount when they catch a ride on Tuesday. Those who take a trip to the polls using the service will receive 45% off on the ride, in honor of our 45^th president.

The deal will be available from 7 a.m. to 8 p.m. For those who download Lyft for the first time, entering the code NOVEMBER8TH will get you $5 off your first 10 rides.

For those who want to drive themselves to vote but don’t have a vehicle, Zipcar is offering free rentals on over 7,000 cars between 6 p.m. and 10 p.m. on election day. The polls close at 8 p.m. though, so make sure you make it on time.

“Zipcar selected the evening hours on election night to ensure that members who need to zip to the polls during the last few hours have free, easy access to transportation,” the company said in a blog post.

Members of the service can take advantage of the deal via the mobile app or online starting now. New members simply have to download the app to get their free ride.

Keeping a clean house isn’t always easy where kids are involved, but it may be worth striving for if you’ve got a child with asthma.

According to a new report from the American Academy of Pediatrics (AAP), reducing household allergens and pollutants can help reduce their symptoms. What's more, eliminating indoor triggers may even reduce kids' need for medication.

Identifying triggers

Pets and smoke

"The allergen that the pet produces is airborne and very sticky, and so even when you try to isolate the pet, you don't really have any improvement in the child's asthma," Matsui told HealthDay.

Matsui believes that eliminating environmental triggers should be “an integral part of asthma management.” Children’s asthma symptoms can be greatly reduced if environmental exposures are targeted, she says, but it’s important that parents be thorough when targeting triggers.

Of the 125 million people worldwide who suffer from psoriasis, approximately one-third are children. But the lack of FDA-approved treatment options has made treating cases of psoriasis in pediatric patients an uphill battle for many parents.

Previously, treatment options consisted of antihistamines and topical treatments. In severe cases, phototherapy or the use of the powerful drugs methotrexate or cyclosporine may be recommended, but these treatment options may carry risks for children.

Beranek calls the approval “an important development for this patient community, as well as their parents and families" and says it represents a huge leap forward in advancing the treatment of children living with psoriasis.

Study results

Enbrel obtained FDA approval following a successful year-long Phase 3 study. A five-year open-label extension study helped evaluate the drug’s safety and efficacy in children. The results showed that not only was the drug effective, its adverse effects were similar to those seen in previous studies with adults.

Enbrel’s FDA approval, he says, “shows that innovation doesn't stop with a drug's first market approval, and further reflects Amgen's commitment to continually unlock and expand the therapeutic potential of our medicines in the hopes of filling unmet patient needs."

You may have thought FBI Director James Comey's surprise announcement over the weekend that the Hillary Clinton email probe is closed again was the big factor in affecting the race with Donald Trump.

But according to Dish Network, a Clinton victory is baked into America's TV viewing choices. Come January 20, the company predicts, Hillary Clinton will be taking the oath of office.

The “Viewers to Voters” predictive model analyzed anonymous viewership data. Who watches what apparently determines the outcome of the vote. The results show Democrats keeping the White House but Republicans retaining control of the House. The data couldn't get a read on the outcome of Senate races.

Viewership reveals political leanings

The folks at Dish maintain that what you tend to watch on TV reveals your political leanings. For example, it says consumers who watch sports, religious programming, or family-oriented television are more likely to pull the lever for the GOP.

But consumers who watch series and specials, as well as education and music-themed programs, are more likely to support Democrats.

Dish, of course, has access to all this information and its read, based on the numbers it's seen so far, suggests there are more Democrat-leaning viewers than Republican consumers. Of course, the company has no way of knowing who is watching what on DirecTV and other providers, so how reliable can it be?

The company says it deployed the analysis for the first time two years ago, during the mid-term election, and the forecast was 98% accurate.

A different election

True, but this presidential race has been unlike any other in recent memory. One candidate has been investigated by the FBI. The other was caught on tape bragging in vulgar language about his power over women.

In a normal year, it might have disqualified both. But this year, they are somehow running against each other.

What isn't clear from the Dish Network viewership analysis is how many consumers were desperately trying to find something on TV to watch to divert their attention from the election.

Four patients have died and nine others became ill from a dangerous new fungal infection that has been emerging globally over the last few months, the Centers for Disease Control and Prevention reports.

Candida auris (C. auris) is often resistant to antifungal drugs and tends to occur in hospitalized patients.Seven of the cases are described in CDC's most recent Morbidity and Mortality Weekly Report (MMWR). The other six cases were identified after the period covered by the report and are still under investigation.

“We need to act now to better understand, contain and stop the spread of this drug-resistant fungus,” said CDC Director Tom Frieden, M.D., M.P.H. “This is an emerging threat, and we need to protect vulnerable patients and others.”

Can be misidentified

Patients whose cases were described in the report were from New York, Illinois, Maryland, and New Jersey. Four died, although the CDC said it was unclear if C. auris was the cause of their deaths, since all were hospitalized and had underlying medical conditions.

Two of the patients were being treated in the same facility and had nearly identical fungal strains, suggesting that C. auris can be spread in healthcare settings.

Six of the seven cases discussed in the report were identified after the fact. This highlights the risk that C. auris can be misidentified as another type of less serious Candida infection, in which cases patients may not receive the appropriate treatment.

The CDC said that most of the strains found in the seven patients showed some signs of drug resistance, making treatment more difficult. In other countries, C. auris strains have been found to be resistant to all three major classes of antifungal medications.

Researchers said it appeared that all of the patients had acquired the strains locally, since they had not traveled to South Asia or South America, where the strains originated.

“It appears that C. auris arrived in the United States only in the past few years,” said Tom Chiller, M.D., M.P.H., chief of CDC’s Mycotic Diseases Branch. “We’re working hard with partners to better understand this fungus and how it spreads so we can improve infection control recommendations and help protect people.”

For families and individuals living paycheck-to-paycheck, saving money for the future, or for an emergency fund, might seem out of the question. But by developing a budget plan and sticking with it, it is possible to get ahead, assuming you are not currently drowning in debt.

The secret, according to many financial advisers, is to take baby steps, cutting costs a little here and there, and then not spending the savings on other things. Here are five ideas that might help you carve out a little room in your budget.

Eat at home

Food costs account for a huge part of spending each month, and unfortunately this spending isn't always subject to a budget. If you aren't tracking what you're spending at the supermarket each week, you're probably spending a lot more than you think.

That's bad enough, but when you throw in a few meals at restaurants, then spending on food can quickly get out of control.

Eating meals at home will save money, pure and simple. To maximize savings, plan meals before going to the supermarket. Use coupons and buy things on sale. Saving money on food will deliver the biggest bang for the buck when it comes to a household budget.

Don't pay for banking services

Ever wondered how banks can afford to offer free checking and other services? Because most of their customers are paying for them. Don't be one of them.

A monthly service charge on a checking account can easily be $10 a month. Out of network ATM fees can be $6 or more. Look for a bank or credit union that not only offers free checking, but will also pay you interest on your balance and reimburse ATM fees. If you keep your savings in your checking account, and have the discipline not to spend it, you can probably earn more interest than you would in a passbook savings accounts.

And, for heaven's sake, don't use a credit card that charges an annual fee. There are plenty of credit cards with no fee and that pay some kind of cash back rewards.

Negotiate lower rates

Most of us have fixed costs in our budget, but just how fixed are they? Your auto and homeowners' insurance premium may be the same amount each month, but these companies may be very willing to reduce your rate in order to keep you as a customer.

Call them and tell them you have been shopping around and have found lower rates. Ask them what they can do. To save money, sometimes you only have to ask.

The same is true for your cellphone provider. And while they might not lower your rate, you may be able to move into a less expensive plan.

Reduce interest payments

If you have a large credit card balance, it's probably taking a big bite out of your budget. You are also probably paying 15% or more in interest, making it harder to pay off.

If you can transfer all or part of the balance to a credit card with a 0% introductory rate on balance transfers, you can save hundreds of dollars a year in interest. Just select a card that doesn't charge a high balance transfer fee. The Chase Slate card is one that doesn't.

Track your spending for a week

Finally, carry a small notebook with you for a week. Every time you spend any money, whether it's pocket change or a credit card purchase, write down what it was for and how much you spent.

It's amazing, but at the end of seven days you'll have an eye-opening picture of your spending habits and where you might be able to cut back.

Toyota Motor Engineering & Manufacturing is recalling 7,056 model year 2016 Highlanders manufactured May 26, 2016, to September 16, 2016.

The brake fluid level sensor may not be connected to the wire harness, preventing the sensor from detecting the brake fluid level. As such, these vehicles fail to comply with the requirements of Federal Motor Vehicle Safety Standard (FMVSS) No. 135, "Light Vehicle Brake Systems."

If the brake fluid level is low and is not detected, braking performance may be decreased, increasing the risk of a crash.

What to do

Toyota will notify owners, and dealers will inspect and, as necessary, connect the wire harness to the sensor, free of charge. The recall is expected to begin November 7, 2016.

Owners may contact Toyota customer service at 1-800-331-4331. Toyota's number for this G03.

Mercedes-Benz USA (MBUSA) is recalling 996 model year 2016-2017 S550 Coupe 4MATICs, S63 AMG Coupe 4MATICs, S65 AMG Coupes and S63 AMG Convertible 4Matics manufactured September 3, 2015, to February 4, 2016.

The low beam headlights on the affected vehicles may not be adjusted properly. As such, these vehicles fail to comply with the requirements of Federal Motor Vehicle Safety Standard (FMVSS) number 108, "Lamps, Reflective Devices, and Associated Equipment."

If the low-beam headlights are out of adjustment, the driver's visibility may be reduced, increasing the risk of a crash.

What to do

MBUSA will notify owners, and dealers will inspect and correct the headlight adjustment, as necessary, free of charge. The recall is expected to begin in November 2016.

Owners may contact MBUSA customer service at 1-800-367-6372.

There is no cure for children who have been chronically exposed to low levels of lead, and even a $27,000 drug treatment can't change that. Valeant Pharmaceuticals has recently enraged a Congressman from Flint and others by increasing the price of its lead poisoning treatment drug by nearly 3,000 percent.

"Valeant Pharmaceuticals increased the price of Calcium Disodium EDTA, used to treat acute lead poisoning, from $900 to $27,000 per treatment. This is a 3,000 percent increase," Rep. Dan Kildee wrote to four House committee leaders on November 1.  

Valeant Pharmaceuticals responded to the controversy in a public statement that their drug is not appropriate for kids affected by the Flint water crisis, which they say played no role in their decision to increase prices.

"Contrary to recent statements and media reports linking this product to the Flint water crisis, CDV is not used to treat elevated levels of lead in the blood that result from the chronic low-level lead exposure like that reportedly experienced in Flint, Michigan," Valeant said.

No cure for intellectual problems

CDV is a form of chelation therapy, or a drug that binds to toxins like lead in the bloodstream. The FDA approved the first oral chelation treatment for children exposed to high levels of lead in 1991.

When a group of independent researchers studied chelation therapy on children exposed to lead one decade later, they confirmed that it only worked on children exposed to extremely high amounts of lead, or the kind of exposure that puts children at immediate risk of coma, seizure, and death.

Chelation therapy, however, does not solve the type of chronic, long-term learning problems caused by low-level lead exposure, problems that kids in Flint are now saddled with thanks to their local bureaucracies.  

"That's why you have to prevent lead poisoning. There is no medical treatment,"  Dr. Jerome Paulson, a professor in pediatrics and environmental health, tells ConsumerAffairs.

"What chelating agents do is rapidly reduce the amount of lead in the blood...but they don't help children with lower blood lead levels in terms of preventing any learning problems or brain damage or decreased IQ or those kinds of things," Paulson says. Doctors should not be prescripting chelation therapy to children in Flint, he says, and if they are, he describes such actions as unscrupulous.

"We do things kind of backwards in this country, we find kids who have elevated blood levels and then we go fix their apartments, fix their water. We really need to screen places that are hazardous and fix them before the kids get there," Paulson said.

Other reasons to fight the price increase

While American children are commonly victims of low-level lead exposure, children in third-world countries can still be exposed to lead in extreme amounts, so much so that chelation treatment is necessary to help them.  

Rep. Kildee's letter to Valeant pharmaceuticals didn't actually accuse the company of price-gouging Flint’s kids, even though he is a Flint representative. Instead, he accurately points out that the World Health Organization has included Calcium Disodium EDTV on its list of essential medicines and calls for a government investigation into the price increase.

A Valeant spokesman justified the price increase to a Stat reporter by blaming low purchase volume of its product: “The list price increases over the past several years have enabled us to provide to the market consistent availability of a product with high carrying costs and very limited purchase volume of 200 to 300 units per year.”

Lately, there’s been a lot of outrage aimed at the pharmaceutical industry over high drug prices. Consumers are coming around to the idea that they shouldn’t have to pay thousands of dollars for a life-saving treatment that has basically stayed the same for years.

However, many experts have pointed out that high hospital costs are also putting people in a tough spot. One of them, Dr. Robert M. Doroghazi, has gone as far as to say that high hospital profits are causing extensive damage to the field of medicine. In his commentary, he addresses the high profitability of both for-profit and non-profit hospitals.

"I believe the quest for profits between all hospitals, non-profit and for-profit, has been one of the main drivers causing our health care costs to be the highest in the world, far out-stripping inflation,” he said.

"Non-profit" hospitals

It’s something that many people might not even think twice about, but how exactly can a non-profit hospital be so profitable? Doroghazi says it’s a problem that started decades ago, and it has to do with how a non-profit institution is defined.

Back in 1956, the IRS recognized the tax-exempt status of hospitals, with the essential condition that they provide a certain level of charity care. However, when Medicare and Medicaid were passed in 1965, write-offs for charity care were drastically reduced. This led to a revision by the IRS in 1969 that gave hospital administrators wide parameters for applying for tax-exempt status.

Hospitals everywhere began substituting programs for charity care and used the less well-defined requirements to rake in large profits. Doroghazi notes that non-profit tax exemption accounted for $12.6 billion in 2002. In 2006, the IRS attempted to rein in abuses by making additional provisions, but they were unsuccessful in the long-run. By 2011, non-profit tax exemption had inflated to $24.6 billion.

Doroghazi says that hospital executives have also used their hospitals’ tax-exempt status for their own personal benefit, raking in millions of dollars annually. “I do not believe the average chief executive officer. . . is more valuable to society than 100 registered nurses. . . Possible adjectives to describe these salaries at ‘nonprofit’ institutions include ‘generous,’ ‘rock-star,’ ‘outrageous,’ or even ‘obscene,’” he said.

Changes made in recent years by the IRS have attempted to require hospitals to write a financial-assistance policy on all emergency and medically necessary care for their communities every three years, but Doroghazi says these “cosmetic changes” most likely will not have the desired effect.

For-profit hospitals

Like non-profit hospitals, Doroghazi charges that for-profit institutions became problematic many years ago, after the passage of Medicare and Medicaid decreased the need for charity care.

He points out that there are only so many ways that hospitals can generate enough revenue to pay off their investors. While providing better and more efficient care is one of them, he says the route that these institutions have elected to go with is to charge more for services.

A study conducted in 2015 showed that 49 of the 50 highest-charging hospitals in the U.S. were for-profit. These institutions are often accused more often of “cherry picking” their patients – turning those who can’t pay for services away while grabbing up those who will help them turn a profit. This is especially true, Doroghazi says, of those who need high-end procedures that have a high cost.

Recommendations

Doroghazi makes a few recommendations on how high hospital profits can be curbed to benefit the public. First, he says that Congress should intervene and provide more concrete definitions for what constitutes a non-profit. Specifically, he says that these institutions should actually make no profit, having enough money to maintain quality operations, prudent reserves, and fund future capital needs.

Next, he says that the salaries of administrators at non-profits should match those of other non-profit organizations, such as the Boy Scouts of America or the Salvation Army.

Finally, he talks about how institutions should strive to provide the best care they can for patients and not inflate their own personal holdings by driving up costs.

“There are two kinds of competition. Henry Ford was relentless in building cars that were of higher quality and less expensive. This is America at its best: all society benefitted. I believe current hospital competition has done nothing but drive up costs: new hospitals are often described by locals as a Taj Mahal, with spacious, well-appointed rooms, art work on the walls, and lobbies larger than indoor football fields. Hospitals add high-end, expensive technology that benefits few, and then unleash their Madison Avenue-size advertising budget to tell everyone they are the fourth in the area with a helicopter," he said.

The full commentary has been published in The American Journal of Medicine. 

A lawsuit has been filed against Royal Caribbean for allegedly not making an effort to save or recover the body of Bernardo Texeira Garcia -- a passenger who had fallen overboard.

The federal complaint, filed Tuesday by Erik Elbaz -- the victim’s husband, states that ship employees were hostile towards the couple before the incident occurred on November 6, 2015. They allegedly used homophobic taunts and slurs, and complaints the couple made to supervisors led nowhere.

Elbaz says that the situation came to a head when one employee called Garcia a “pedophile.” The couple returned to their stateroom very upset and, a short time later, security officers arrived and threatened to arrest Garcia, the suit alleges.

The complaint goes on to say that a distraught Garcia then fell from the room’s balcony and landed on lifeboats located on a lower deck. Though crewmembers held onto him for several minutes, they ultimately failed to secure Garcia and he fell off the ship.

Told to calm down

Elbaz alleges that he pleaded with Royal Caribbean officials to stop the ship and turn back for his husband, but was simply told to calm down. "Royal Caribbean failed to deploy lifeboats within a reasonable time and failed to promptly stop and/or return the ship around," Elbaz says in his complaint.

The U.S. Coast Guard was notified of the incident by Royal Caribbean, but a search-and-rescue operation was unsuccessful, as a body was never found.

Elbaz is suing Royal Caribbean and seeking compensatory damages for negligence, infliction of emotional distress, and violations of the High Seas Act. The suit points out that there have been 16 incidents of a passenger falling overboard on a Royal Caribbean voyage between 2000 and 2015; only three of those victims survived.

At the time of posting, Royal Caribbean Cruises had not responded to a request for comment from Courthouse News Service.