Iraq death toll

Predicted Increase

Study: Workers to pay more for health care

09/04/08

By CANDICE CHOI, AP Business Writer

NEW YORK - Get ready for another hike in copays and deductibles. A survey being released Thursday by the Mercer consulting firm found 59 percent of companies intend to keep down rising health care costs in 2009 by raising workers' deductibles, copays or out-of-pocket spending limits.

On average, health care costs will go up by an estimated 5.7 percent next year for both workers and their employers, the study found. That repeats this year's 5.7 percent hike and a 6.1 percent jump in 2007.

The growth of health care costs has hovered at around 6 percent since 2005, according to Mercer. While that's down from the double-digit growth in previous years, it's still moving at a faster clip than inflation or workers wages.

"It's not something to cheer about, especially since costs are getting passed on to employees," said Blaine Bos, author of the survey.

The results were preliminary findings, with about half of the 3,000 large companies surveyed reporting. Preliminary findings for the annual survey have historically been in line with final results.

Between 2003 and 2007, the average deductible for an individual grew from $250 to $400. For a family, it rose from $1,000 to $1,500, according to Mercer.

Deductibles are the amount workers pay for medical care out of pocket. Once workers spend that amount, they begin sharing costs with employers, with the company covering an average of 80 percent.

Health plans are trying to rein in costs by offering choices such as disease management plans and incentives for greater use of prescription drugs, said Robert Zirkelbach, a spokesman for America's Health Insurance Plans, a trade association representing nearly 1,300 insurers.

"But there's certainly still more work to be done," Zirkelbach said.

He said AHIP has proposed a number of policies and measures to further curb costs.

The Mercer survey also found 47 percent of companies are encouraging enrollment in plans with lower premiums and higher deductibles.

Additionally, the survey found 19 percent of employers will start offering a consumer-directed health plan. These are high-deductible plans with employee-controlled spending accounts. They encourage employees to consider costs when by letting them save account money they don't spend for future needs.

Last year, 12 percent of all employers said they were "very likely" to implement such a plan by 2009.

Economy

08/29/08

WASHINGTON - Personal incomes plunged in July while consumer spending slowed significantly as the impact of billions of dollars in government rebate checks began to wane.

The Commerce Department reported Friday that personal incomes fell by 0.7 percent in July, the biggest drop in nearly three years and a far larger decline than the 0.1 percent decrease analysts expected.

Consumer spending edged up a modest 0.2 percent, in line with expectations, but far below June's 0.6 percent rise. When the impact of rising prices was factored in, spending actually dropped by 0.4 percent in July, the weakest showing for inflation-adjusted spending in more than four years.

The July performance for incomes and spending reinforced worries that the economy, which posted better-than-expected growth in the spring because of the rebate checks, could stumble in coming months as their impact fades.

Some economists worry that overall economic growth, which rose at a 3.3 percent annual rate from April-June, could come in at less than half that pace in the current quarter, and could actually dip into negative territory in the final three months of this year and the first quarter of 2009.

Back-to-back declines in the gross domestic product, which measures the value of all goods and services produced within the U.S. and is the best barometer of the country's economic health, would meet one rule of thumb for a recession.

A gauge of inflation closely watched by the Federal Reserve remained elevated in July, rising by 0.6 percent. Over the past 12 months, this inflation gauge tied to consumer spending was up 4.5 percent, the biggest year-over-year increase in more than 17 years.

The surge reflected the big increases that have occurred this year in food and energy costs. Excluding food and energy, inflation by this measure was up 0.3 percent in July, and 2.4 percent over the past 12 months, still above the Fed's comfort zone. The central bank is caught in a bind between a sluggish economy and rising inflation pressures.

The 0.7 percent drop in personal incomes followed a 0.1 percent rise in June and a 1.8 percent surge in May. After-tax incomes dropped by an even bigger 1.1 percent in July, following a 1.9 percent decline in June and a 5.7 percent surge in May. All the income figures were heavily influenced by the rebate checks.

Democrats, including presidential nominee Barack Obama, are calling for the government to pass a second stimulus package to guard against the economy slumping into a deep recession.

But President Bush, concerned about the impact the stimulus payments will have on the budget deficit, has resisted those calls, insisting that the rebate payments will continue to support the economy in coming months. The administration is already forecasting that the federal budget deficit for the budget year that begins on Oct. 1 will soar to an all-time high in dollar terms of $482 billion.

The report on consumer spending also showed that personal savings totaled 1.2 percent of after-tax incomes in July, down from a rate of 2.5 percent in June.

OBAMA SPEECH

Obama sketches promise of America

By NEDRA PICKLER, Associated Press Writer 1 hour, 1 minute ago

DENVER - Barack Obama cast his presidential nomination as proof that no dreams are too high, savoring a historic moment for himself and the nation Thursday before setting out on a difficult struggle to break another barrier for a black American.

Obama's success in obtaining the Democratic nomination was indeed a remarkable achievement, reached despite the misgivings of some Americans uncomfortable with electing the son of an African immigrant — not "the typical pedigree," as he put it.

He used his acceptance speech at the Democratic National Convention in part to allay those concerns, to show Americans that he is one of them — not born of wealth or privilege, his gains made of hard work and sacrifice.

"This moment — this election — is our chance to keep, in the 21st Century, the American promise alive," Obama said in prepared remarks. He put himself in the shadow of great leaders like John Kennedy, Franklin Roosevelt and Martin Luther King, Jr., as well as his humble parents.

For those voters with another concern — that a first-term senator who just turned 47 isn't experienced enough to lead the country — Obama had an answer, too, in a list of policy proposals that he argued would improve their lives. He promised tax cuts that would benefit workers, an end to dependence on Middle East oil, more funding for education, health care for every American and an end to the war in Iraq.

"America, now is not the time for small plans," Obama said.

And he tried to raise concerns about his rival, Republican John McCain, by saying he's too much like the unpopular President Bush.

"John McCain has voted with George Bush 90 percent of the time," Obama said. "Senator McCain likes to talk about judgment, but really, what does it say about your judgment when you think George Bush was right more than 90 percent of the time? I don't know about you, but I'm not ready to take a 10 percent chance on change."

With the nomination in hand, Obama could afford to pause — if only for a moment — to reflect on the path that took him from untested rising star at the Democratic convention just four years ago to the party's standard-bearer this time and a symbol of hope to millions of Americans yearning for change.

Obama himself took note of the transformation.

"Four years ago, I stood before you and told you my story — of the brief union between a young man from Kenya and a young woman from Kansas who weren't well-off or well-known — but shared a belief that in America, their son could achieve whatever he put his mind to."

Then he launched himself into the task at hand, persuading voters that he is the leader for "one of those defining moments — a moment when our nation is at war, our economy is in turmoil, and the American promise has been threatened once more."

Obama didn't flinch from offering himself as ready not only for the title of president but also of "commander in chief."

"If John McCain wants to have a debate about who has the temperament, and judgment, to serve as the next commander in chief, that's a debate I'm ready to have," Obama said.

His speech was the culminating moment of the Democrats' four-day convention, the launching point for a difficult fall campaign against McCain. He was to make his case before an enthusiastic crowd of 84,000 at Invesco Field at Mile High, every participant equipped by organizers with their own American flags to wave. More important was the audience of millions of Americans watching on television, a tougher crowd.

Obama tried to tone down the hype of a stadium audience and a Greek-style stage by giving unknown Americans prime-time speaking roles to explain their struggles and how Obama could help them. And Obama himself highlighted the stories of working class Americans, the kinds of voters who have expressed wariness of his candidacy — the woman about to retire in Ohio worried about health care costs, the Indiana worker who lost his job to competition from China, the veterans living on the streets or in poverty, the military families in the midst of repeat tours of duty.

He said he sees his World War II veteran grandfather in the faces of veterans returning from Iraq and Afghanistan, recognizes his mother in the overworked student yearning to give her children a better life and hears his grandmother in the voice of the businesswoman facing workplace discrimination.

"I get it," Obama said. "I realize that I am not the likeliest candidate for this office. I don't fit the typical pedigree, and I haven't spent my career in the halls of Washington. But I stand before you tonight because all across America something is stirring. What the nay-sayers don't understand is that this election has never been about me. It's been about you."