Blog

(Reuters) – The U.S. government on Wednesday proposed a 2025 reimbursement rate for Medicare Advantage plans run by private insurers that reflects an effective growth rate of 2.44% and a total increase of 3.7%.

The closely watched proposal, known as the “advance notice”, will be used by companies such as UnitedHealth Group and Humana to bid this year for contracts for Medicare Advantage plans they will sell in 2025.

The government payment rates affect how much insurers charge for monthly premiums, which plan benefits they offer and ultimately, how much they can profit.

About 65 million people are enrolled in the government’s Medicare program for people aged 65 and older or who are disabled. About 34 million are in the orginal Medicare and the rest are in plans run by health insurers but paid for by the government.

The government has a three-year plan to decrease payments for Medicare Advantage as part of an effort it said will bring them more in line with the orginal Medicare coverage.

The proposed rates typically change after feedback from the insurers, other entities and the public. The final rate announcement will be published on or before April 1, 2024.

Elevance Health and CVS Health Corp’s Aetna also offer Medicare Advantage.

(Reporting by Pratik Jain in Bengaluru; Editing by Caroline Humer and Krishna Chandra Eluri)

By Clark Mindock

(Reuters) – A group of 25 California counties have sued Elon Musk’s Tesla, claiming the electric vehicle maker mishandled hazardous waste at its facilities across the state.

The lawsuit from Los Angeles, Alameda, San Joaquin, San Francisco and other counties was filed on Tuesday in California state court. It seeks civil penalties and an injunction that would require the company to properly handle its waste in the future.

Tesla did not immediately respond to a request for comment.

The counties accused Tesla of violating state unfair business and hazardous waste management laws by improperly labeling waste and sending the materials to landfills that cannot accept hazardous material. California’s hazardous waste management law carries potential civil penalties as high as $70,000 per violation per day.

Waste produced or handled at the facilities includes paint materials, brake fluids, used batteries, antifreeze and diesel fuel, the counties said.

The lawsuit claims that violations have occurred at as many as 101 facilities, including at Tesla’s manufacturing plant in Fremont.

Spokespeople for the counties did not immediately provide additional details about the case.

The lawsuit is not the first time Tesla has faced allegations related to its hazardous waste management practices.

The company reached a settlement in 2019 with the U.S. Environmental Protection Agency over alleged federal hazardous waste violations at its Fremont plant. In that deal, Tesla agreed to take steps to properly manage waste at the facility and pay a $31,000 fine.

Tesla later reached a deal with the EPA in 2022 in which it agreed to pay a $275,000 penalty after the federal agency said the company was failing to keep records and to implement plans to minimize air pollutants from painting operations at the Fremont plant.

(Reporting by Clark Mindock; Editing by David Bario and Mark Porter)

By Michael Martina, Patricia Zengerle and Andrew Goudsward

WASHINGTON (Reuters) -Hackers linked to the Chinese government are targeting critical U.S. infrastructure, preparing to cause “real-world harm” to Americans, FBI Director Christopher Wray told a congressional committee on Wednesday.

Water treatment plants, the electric grid, oil and natural gas pipelines and transportation hubs are among the targets of state-sponsored hacking operations, he told the House of Representatives Select Committee on competition with China

Wray spoke the same day U.S. officials announced that they had disrupted a sweeping Chinese cyber-spying operation.

“They’re not focused just on political and military targets. We can see from where they position themselves across civilian infrastructure, that low blows aren’t just a possibility in the event of conflict, low blows against civilians are part of China’s plan,” Wray said.

The Chinese foreign ministry did not immediately respond to a request for comment on the matter.

Wray stressed that U.S. government concerns were not linked to Chinese Americans or Chinese nationals in the U.S., who he said were themselves often targets of Beijing’s “aggression”.

The hearing came at a time of heightened tensions between the United States and China over the status of democratically governed Taiwan, China’s rapid military build-up, economic and technology competition, and Beijing’s human rights record.

According to U.S. media reports, China’s President Xi Jinping told President Joe Biden in November that Beijing would not interfere in the 2024 U.S. election.

Asked about the reported pledge, Wray said: “China has promised a lot of things over the years. So, I guess I’ll believe it when I see it.”

The officials told the hearing they had confidence in the U.S. election infrastructure.

Wray has repeatedly said Beijing is trying to undermine the United States through espionage campaigns, intellectual property theft and cyberattacks.

The Chinese government has previously accused the United States and its allies of spreading “disinformation” through its accusations against what Washington says are state-sponsored hacking groups.

‘EQUIVALENT OF PLACING BOMBS’

Wray testified along with General Paul Nakasone, commander of U.S. cyber command, and other top federal cybersecurity officials. Nakasone, who steps down from his position this week, was greeted by the committee with a standing ovation.

“This is the cyberspace equivalent of placing bombs on American bridges, water treatment facilities, and power plants. There is no economic benefit for these actions. There is no intelligence gathering rationale,” said Republican Representative Mike Gallagher, the committee’s chairman.

Jen Easterly, director of the Cybersecurity and Infrastructure Security Agency, said the United States has “found and eradicated” Chinese cyber intrusions in aviation, water, energy and transportation infrastructure, and said Americans need to prepare for an unexpected attack.

The hearing is one of the highest-profile events conducted by the year-old bipartisan select committee, set up in part to explain to Americans why they should care about addressing growing threats posed by the top U.S. geopolitical rival.

Gallagher reiterated calls to ban or force the sale of short-video sharing app TikTok, owned by Chinese tech company ByteDance, saying its continued unfettered use in the U.S. would “be bordering on national suicide”.

(Reporting by David Ljunggren)

By David Shepardson and Makini Brice

WASHINGTON (Reuters) -U.S. senators on Wednesday grilled leaders of the biggest social media companies and said Congress must quickly pass legislation, as one lawmaker accused the companies of having “blood on their hands” for failing to protect children from escalating threats of sexual predation on their platforms.

The hearing marks the latest effort by lawmakers to address the concerns of parents and mental health experts that social media companies put profits over guardrails that would ensure their platforms do not harm children.

“Mr. Zuckerberg, you and the companies before us, I know you don’t mean it to be so, but you have blood on your hands,” said Republican Senator Lindsey Graham, referring to Meta CEO Mark Zuckerberg. “You have a product that’s killing people.”

Zuckerberg testified along with X CEO Linda Yaccarino, Snap CEO Evan Spiegel, TikTok CEO Shou Zi Chew and Discord CEO Jason Citron.

Senator Dick Durbin, the Judiciary Committee’s Democratic chairman, cited statistics from the National Center for Missing and Exploited Children nonprofit group that showed skyrocketing growth in financial “sextortion,” in which a predator tricks a minor into sending explicit photos and videos.

“This disturbing growth in child sexual exploitation is driven by one thing: changes in technology,” Durbin said during the hearing.

As the hearing kicked off, the committee played a video in which children spoke about being victimized on social media.

“I was sexually exploited on Facebook,” said one child in the video, who appeared in shadow.

In the hearing room, dozens of parents held pictures of their children who they said had been harmed due to social media. Some parents jeered Zuckerberg, whose company owns Facebook and Instagram, during his opening statement and shouted comments at other points during the hearing.

At one point, Senator Josh Hawley challenged Zuckerberg to apologize to them directly, and several people held the children’s photos aloft again as Zuckerberg turned around to address them.

Zuckerberg expressed regret about what they had experienced and pledged to work to prevent it from happening to others, but stopped short of taking responsibility for facilitating the abuse, as Hawley suggested he should.

In a tense exchange, the committee displayed copies of internal emails showing Zuckerberg rejecting a request by Meta’s top policy executive to hire between 45 and 84 engineers to work on safety improvements.

X’s Yaccarino said the company supported the STOP CSAM Act, legislation introduced by Durbin that seeks to hold tech companies accountable for child sexual abuse material and would allow victims to sue tech platforms and app stores.

The bill is one of several aimed at addressing child safety. None have become law.

X, formerly Twitter, has come under heavy criticism since Elon Musk bought the service and loosened moderation policies. This week, it blocked searches for pop singer Taylor Swift after fake sexually explicit images of her spread on the platform.

Wednesday also marked the first appearance by TikTok CEO Chew before U.S. lawmakers since March, when the Chinese-owned short video app company faced harsh questions, including some suggesting the app was damaging children’s mental health.

Chew disclosed more than 170 million Americans used TikTok monthly, 20 million more than the company said last year.

Under questioning by Graham, he said TikTok would spend more than $2 billion on trust and safety efforts, but declined to say how the figure compared to the company’s overall revenue.

Senator Ted Cruz, a Republican, pressed Zuckerberg about warning screens on Instagram that alerted users an image might show child sexual abuse, but still allowed them to see the image.

“Mr. Zuckerberg, what the hell were you thinking?” Cruz said.

Zuckerberg responded that it can be helpful to redirect users to resources rather than blocking content, adding the company would follow up with more information about the notice.

Democratic Senator Amy Klobuchar questioned what she said was inaction in the tech industry, comparing it to the response shown when a panel blew out of a Boeing plane earlier this month.

“When a Boeing plane lost a door in flight several weeks ago, nobody questioned the decision to ground a fleet… So why aren’t we taking the same type of decisive action on the danger of these platforms when we know these kids are dying?” Klobuchar said.

(Reporting by David Shepardson and Makini Brice; additional reporting by Sheila Dang and Katie Paul; Editing by Jonathan Oatis and Rosalba O’Brien)

By David Shepardson and Makini Brice

WASHINGTON (Reuters) – U.S. senators on Wednesday grilled the biggest social media and messaging companies, saying they had failed to do enough to protect children from sexual predators on their platforms, and said Congress must quickly pass legislation.

The hearing marks the latest effort by lawmakers to address the concerns of parents and mental health experts that social media companies put profits over making sure their platforms do not harm children.

“Mr. Zuckerberg, you and the companies before us, I know you don’t mean it to be so, but you have blood on your hands,” said Senator Lindsey Graham, referring to Meta CEO Mark Zuckerberg. “You have a product that’s killing people.”

Zuckerberg testified along with X CEO Linda Yaccarino, Snap CEO Evan Spiegel, TikTok CEO Shou Zi Chew and Discord CEO Jason Citron.

Senator Dick Durbin, the Judiciary Committee’s Democratic chairman, cited statistics from the National Center for Missing and Exploited Children nonprofit group that showed financial “sextortion,” in which a predator tricks a minor into sending explicit photos and videos, had skyrocketed last year.

“This disturbing growth in child sexual exploitation is driven by one thing: changes in technology,” Durbin said during the hearing.

As the hearing kicked off, the committee played a video in which children spoke about being victimized on the social media platforms.

“I was sexually exploited on Facebook,” said one child in the video, who appeared in shadow.

In the hearing room, dozens of parents had stood waiting for the CEOs to enter, holding pictures of their children.

X’s Yaccarino said the company supported the STOP CSAM Act, legislation introduced by Durbin that seeks to hold tech companies accountable for child sexual abuse material and would allow victims to sue tech platforms and app stores.

The bill is one of several aimed at addressing child safety. None have become law.

X, formerly Twitter, has come under heavy criticism since Elon Musk bought the platform and loosened moderation policies. This week, the company blocked searches for pop singer Taylor Swift after fake sexually explicit images of Swift spread on the platform.

Wednesday also marked the first appearance by TikTok CEO Chew before U.S. lawmakers since March when the Chinese-owned short video app company faced harsh questions, including some suggesting the app was damaging children’s mental health.

“We make careful product design choices to help make our app inhospitable to those seeking to harm teens,” Chew said, adding TikTok’s community guidelines strictly prohibit anything that puts “teenagers at risk of exploitation or other harm — and we vigorously enforce them.”

Chew disclosed more than 170 million Americans used TikTok monthly — 20 million more than the company said last year.

Under questioning by Graham, he said TikTok would spend more than $2 billion on trust and safety efforts, but declined to say how the figure compared to the company’s overall revenue.

Senator Ted Cruz grilled Zuckerberg about warning screens on Instagram that alerted users an image might show child sexual abuse, but still allowed them to see the image.

“Mr. Zuckerberg, what the hell were you thinking?” Cruz said.

Zuckerberg responded that it can be helpful to redirect users to resources rather than blocking content, adding the company would follow up with more information about the notice.

He reiterated earlier in the hearing that the company had no plans to move forward with a previous idea to create a kids version of Instagram.

Senator Amy Klobuchar on Wednesday questioned what she said was inaction in the tech industry, comparing it to the response shown when a panel blew out of a Boeing plane earlier this month.

“When a Boeing plane lost a door in flight several weeks ago, nobody questioned the decision to ground a fleet. … So why aren’t we taking the same type of decisive action on the danger of these platforms when we know these kids are dying?” Klobuchar said.

(Reporting by David Shepardson and Makini Brice; additional reporting by Sheila Dang and Katie Paul; Editing by Shri Navaratnam and Jonathan Oatis)

By Michael Martina, Patricia Zengerle and Andrew Goudsward

WASHINGTON (Reuters) -Hackers linked to the Chinese government are targeting critical U.S. infrastructure, preparing to cause “real-world harm” to Americans, FBI Director Christopher Wray told a congressional committee on Wednesday.

Water treatment plants, the electric grid, oil and natural gas pipelines and transportation hubs are among the targets of state-sponsored hacking operations, he told the House of Representatives Select Committee on competition with China.

“They’re not focused just on political and military targets. We can see from where they position themselves across civilian infrastructure, that low blows aren’t just a possibility in the event of conflict, low blows against civilians are part of China’s plan,” Wray said.

“I do want the American people to know that we cannot afford to sleep on this danger,” he said.

The Chinese foreign ministry did not immediately respond to a request for comment on the matter.

Wray has repeatedly said Beijing is trying to undermine the United States through espionage campaigns, intellectual property theft and cyberattacks.

The Chinese government has previously accused the United States and its allies of spreading “disinformation” through its accusations against what Washington says are state-sponsored hacking groups.

Wray testified along with General Paul Nakasone, commander of U.S. cyber command, and other top federal cybersecurity officials at a hearing focused on cyber threats posed by Beijing.

“This is the cyberspace equivalent of placing bombs on American bridges, water treatment facilities, and power plants. There is no economic benefit for these actions. There is no intelligence gathering rationale,” said Republican Representative Mike Gallagher, the committee’s chairman.

“The sole purpose is to be ready to destroy American infrastructure, which will inevitably result in mass American casualties.”

Jen Easterly, director of the Cybersecurity and Infrastructure Security Agency, said the United States has “found and eradicated” Chinese cyber intrusions in aviation, water, energy and transportation infrastructure, and said Americans need to prepare for an unexpected attack.

Separately, officials said on Wednesday that the United States disrupted a Chinese hacking operation that targeted U.S. critical infrastructure.

Reuters reported on Tuesday that the U.S. government launched an operation in recent months against a Chinese hacking operation, Volt Typhoon, which officials said had been spying on U.S. infrastructure networks.

(Reporting by Michael Martina, Andrew Goudsward and Patricia Zengerle; Additional reporting by Liz Lee in Beijing; Editing by Christopher Cushing, Philippa Fletcher and David Ljunggren)

By Stephen Culp

NEW YORK (Reuters) -The tech-heavy Nasdaq lost ground on Tuesday as the market awaited a spate of high profile corporate earnings and the Federal Reserve convened for its monetary policy meeting.

The S&P 500 closed nominally lower after touching a new intraday high, while the blue-chip Dow finished higher.

Shares of Alphabet Inc and Microsoft Corp fell in extended trading after the companies released their quarterly earnings reports.

“There’s a lot of trepidation over the start of the earnings releases from ‘the magnificent seven,’” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. “The stocks have done incredibly well and there’s a little bit of caution being expressed right now and maybe rightly so.”

Economically sensitive sectors such as Dow Transports, chips and small caps underperformed the broader market.

The Labor Department reported an unexpected rise in job openings, hinting that the market remains too solid for the Fed to consider cutting its key policy rate as soon as March.

The Fed is expected to end its policy meeting on Wednesday with a decision to let its key interest rate stand at 5.25%-5.50%. Its accompanying statement and Fed Chair Jerome Powell’s subsequent press conference will be parsed for clues on the timing and number of rate cuts this year.

“I’m going to be looking for language that matches the storyline that we hope to see in 2024, that sometime in the second quarter we’ll see the beginning of a reduction in rates,” Tuz added. “I’m going to be listening for language that confirms that that’s the most likely scenario.”

Fourth-quarter reporting season has shifted into overdrive, with announcements so far by 144 of the companies in the S&P 500. Of those, 78% have delivered consensus-beating earnings, according to LSEG.

On aggregate, analysts now expect fourth-quarter earnings growth of 5.5% over last year, up from the 4.7% seen at the beginning of the month, LSEG data showed.

United Parcel Service slid 8.2% after the package deliverer issued a disappointing annual revenue forecast, weighing on transports.

General Motors jumped 7.8% after the automaker provided an upbeat 2024 earnings forecast, and promised more capital return to shareholders.

Ford Motor rose 2.0%.

The S&P 500 declined 0.06% to end at 4,924.97 points. The Nasdaq Composite Index fell 0.76% to 15,509.90 points, while the Dow Jones Industrial Average rose 0.35% to 38,467.31 points.

Six of the 11 S&P 500 sector indexes rose, led by financials, up 1.2%, followed by a 1.01% gain in energy.

Boeing Co shares slid 2.3% ahead of its quarterly earnings report expected before Wednesday’s opening bell. Scrutiny into the planemaker is intensifying over its 737 MAX 7 after a mid-air cabin blowout on Jan. 5.

Citigroup and Bank of America rose over 3% following rating upgrades from Morgan Stanley, pushing the S&P 500 banks index up 2.1%.

Johnson Controls dropped 3.8% after the building products supplier lowered its full-year profit estimate, while MSCI advanced 9.3% after the global index provider posted a higher fourth-quarter profit.

Super Micro Computer rose 3.5% after the server seller projected stronger-than-expected quarterly sales.

Advancing issues outnumbered falling ones within the S&P 500 by a 1.2-to-one ratio.

Across the U.S. stock market, declining stocks outnumbered rising ones by a 1.4-to-one ratio.

The S&P 500 posted 80 new highs and no new lows. The Nasdaq recorded 126 new highs and 75 new lows.

Volume on U.S. exchanges was relatively light, with 10.3 billion shares traded, compared to an average of 11.5 billion shares over the previous 20 sessions.

(Reporting by Stephen Culp: Additional reporting by Ankika Biswas and Johann M Cherian in Bengaluru; Editing by Richard Chang)

By Stephen Culp

NEW YORK (Reuters) -The tech-heavy Nasdaq lost ground on Tuesday as the market awaited a spate of high profile corporate earnings and the Federal Reserve convened for its monetary policy meeting.

The S&P 500 closed nominally lower after touching a new intraday high, while the blue-chip Dow finished higher.

Shares of Alphabet Inc and Microsoft Corp fell in extended trading after the companies released their quarterly earnings reports.

“There’s a lot of trepidation over the start of the earnings releases from ‘the magnificent seven,’” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. “The stocks have done incredibly well and there’s a little bit of caution being expressed right now and maybe rightly so.”

Economically sensitive sectors such as Dow Transports, chips and small caps underperformed the broader market.

The Labor Department reported an unexpected rise in job openings, hinting that the market remains too solid for the Fed to consider cutting its key policy rate as soon as March.

The Fed is expected to end its policy meeting on Wednesday with a decision to let its key interest rate stand at 5.25%-5.50%. Its accompanying statement and Fed Chair Jerome Powell’s subsequent press conference will be parsed for clues on the timing and number of rate cuts this year.

“I’m going to be looking for language that matches the storyline that we hope to see in 2024, that sometime in the second quarter we’ll see the beginning of a reduction in rates,” Tuz added. “I’m going to be listening for language that confirms that that’s the most likely scenario.”

Fourth-quarter reporting season has shifted into overdrive, with announcements so far by 144 of the companies in the S&P 500. Of those, 78% have delivered consensus-beating earnings, according to LSEG.

On aggregate, analysts now expect fourth-quarter earnings growth of 5.5% over last year, up from the 4.7% seen at the beginning of the month, LSEG data showed.

United Parcel Service slid 8.2% after the package deliverer issued a disappointing annual revenue forecast, weighing on transports.

General Motors jumped 7.8% after the automaker provided an upbeat 2024 earnings forecast, and promised more capital return to shareholders.

Ford Motor rose 2.0%.

The S&P 500 declined 0.06% to end at 4,924.97 points. The Nasdaq Composite Index fell 0.76% to 15,509.90 points, while the Dow Jones Industrial Average rose 0.35% to 38,467.31 points.

Six of the 11 S&P 500 sector indexes rose, led by financials, up 1.2%, followed by a 1.01% gain in energy.

Boeing Co shares slid 2.3% ahead of its quarterly earnings report expected before Wednesday’s opening bell. Scrutiny into the planemaker is intensifying over its 737 MAX 7 after a mid-air cabin blowout on Jan. 5.

Citigroup and Bank of America rose over 3% following rating upgrades from Morgan Stanley, pushing the S&P 500 banks index up 2.1%.

Johnson Controls dropped 3.8% after the building products supplier lowered its full-year profit estimate, while MSCI advanced 9.3% after the global index provider posted a higher fourth-quarter profit.

Super Micro Computer rose 3.5% after the server seller projected stronger-than-expected quarterly sales.

Advancing issues outnumbered falling ones within the S&P 500 by a 1.2-to-one ratio.

Across the U.S. stock market, declining stocks outnumbered rising ones by a 1.4-to-one ratio.

The S&P 500 posted 80 new highs and no new lows. The Nasdaq recorded 126 new highs and 75 new lows.

Volume on U.S. exchanges was relatively light, with 10.3 billion shares traded, compared to an average of 11.5 billion shares over the previous 20 sessions.

(Reporting by Stephen Culp: Additional reporting by Ankika Biswas and Johann M Cherian in Bengaluru; Editing by Richard Chang)

BERLIN (Reuters) – Germany will approve the European Union’s pioneering AI Act after the minister responsible for digital issues said a compromise had been reached.

The European Union in December reached a provisional deal for artificial intelligence rules to establish a regulatory framework for the development of AI, but it has to be agreed by members and the European Parliament.

“Without the use of artificial intelligence, there will be no competitiveness in the future,” said German Digital Minister Volker Wissing, of the pro-business Free Democrats who are strong advocates of protecting civil liberties.

“The wrangling over the German position on the AI Act came to an end today with an acceptable compromise,” he added.

Wissing said he had campaigned for more innovation-friendly rules and achieved improvements for small and medium-sized businesses to avoid disproportionate requirements but gave no further details.

“The negotiated compromise lays the foundations for the development of trustworthy AI,” he said.

Earlier, four sources had told Reuters that the FDP, junior partners in Social Democrat Olaf Scholz’s awkward three-way coalition with the Greens, had dropped their objections.

(Reporting by Hakan Ersen and Andreas Rinke; Writing by Madeline Chambers; Editing by Kirsti Knolle, Matthias Williams and Barbara Lewis)

By Hannah Lang and Manya Saini

(Reuters) -Payments firm PayPal Holdings is planning to cut about 2,500 jobs, or 9% of its global workforce, this year, a letter from CEO Alex Chriss, seen by Reuters, showed on Tuesday.

In the letter to staff, newly appointed CEO Chriss said the decision was made to “right-size” the company through both direct cuts and the elimination of open roles throughout the year. The staff that will be affected are expected to be notified by the end of the week.

“We are doing this to right-size our business, allowing us to move with the speed needed to deliver for our customers and drive profitable growth,” Chriss wrote in the letter.

The company did not immediately respond to a Reuters request for comment. Paypal’s shares were last up 0.5% in late afternoon trading.

In November, Chriss said he expects to increase revenue outside of purely transaction-related volume and pledged to turn the fintech firm leaner by reducing its cost base.

Though the announcement had helped rally the stock after third-quarter results, analysts have remained focused on PayPal’s margins in recent quarters.

The company’s low-margin business products have risen strongly, while growth in its branded products has slowed due to increased pressure from competitors such as Apple.

Investors hope Chriss, who was previously a senior executive at software company Intuit, will revive PayPal’s stock. It fell nearly 14% last year and missed a broader sector-wide rebound in high-growth technology shares.

Last week, the payments firm announced it was launching new artificial intelligence-driven products as well as a one-click checkout feature.

Meanwhile, rival Block, led by Twitter co-founder Jack Dorsey, also began to cut jobs this week as part of its previously disclosed plans to trim headcount and reduce costs, a source told Reuters.

(Reporting by Manya Saini in Bengaluru and Hannah Lang in Washington; Editing by Shilpi Majumdar and Krishna Chandra Eluri)