Fewer health care options for illegal immigrants

ALAMO, Texas (AP) — For years, Sonia Limas would drag her daughters to the emergency room whenever they fell sick. As an illegal immigrant, she had no health insurance, and the only place she knew to seek treatment was the hospital — the most expensive setting for those covering the cost.

The family's options improved somewhat a decade ago with the expansion of community health clinics, which offered free or low-cost care with help from the federal government. But President Barack Obama's health care overhaul threatens to roll back some of those services if clinics and hospitals are overwhelmed with newly insured patients and can't afford to care for as many poor families.

To be clear, Obama's law was never intended to help Limas and an estimated 11 million illegal immigrants like her. Instead, it envisions that 32 million uninsured Americans will get access to coverage by 2019. Because that should mean fewer uninsured patients showing up at hospitals, the Obama program slashed the federal reimbursement for uncompensated care.

But in states with large illegal immigrant populations, the math may not work, especially if lawmakers don't expand Medicaid, the joint state-federal health program for the poor and disabled.

When the reform has been fully implemented, illegal immigrants will make up the nation's second-largest population of uninsured, or about 25 percent. The only larger group will be people who qualify for insurance but fail to enroll, according to a 2012 study by the Washington-based Urban Institute.

And since about two-thirds of illegal immigrants live in just eight states, those areas will have a disproportionate share of the uninsured to care for.

In communities "where the number of undocumented immigrants is greatest, the strain has reached the breaking point," Rich Umbdenstock, president of the American Hospital Association, wrote last year in a letter to Obama, asking him to keep in mind the uncompensated care hospitals gave to that group. "In response, many hospitals have had to curtail services, delay implementing services, or close beds."

The federal government has offered to expand Medicaid, but states must decide whether to take the deal. And in some of those eight states — including Texas, Florida and New Jersey — hospitals are scrambling to determine whether they will still have enough money to treat the remaining uninsured.

Without a Medicaid expansion, the influx of new patients and the looming cuts in federal funding could inflict "a double whammy" in Texas, said David Lopez, CEO of the Harris Health System in Houston, which spends 10 to 15 percent of its $1.2 billion annual budget to care for illegal immigrants.

Realistically, taxpayers are already paying for some of the treatment provided to illegal immigrants because hospitals are required by law to stabilize and treat any patients that arrive in an emergency room, regardless of their ability to pay. The money to cover the costs typically comes from federal, state and local taxes.

A solid accounting of money spent treating illegal immigrants is elusive because most hospitals do not ask for immigration status. But some states have tried.

California, which is home to the nation's largest population of illegal immigrants, spent an estimated $1.2 billion last year through Medicaid to care for 822,500 illegal immigrants.

The New Jersey Hospital Association in 2010 estimated that it cost between $600 million and $650 million annually to treat 550,000 illegal immigrants.

And in Texas, a 2010 analysis by the Health and Human Services Commission found that the agency had provided $96 million in benefits to illegal immigrants, up from $81 million two years earlier. The state's public hospital districts spent an additional $717 million in uncompensated care to treat that population.

If large states such as Florida and Texas make good on their intention to forgo federal money to expand Medicaid, the decision "basically eviscerates" the effects of the health care overhaul in those areas because of "who lives there and what they're eligible for," said Lisa Clemans-Cope, a senior researcher at the Urban Institute.

Seeking to curb expenses, hospitals might change what qualifies as an emergency or cap the number of uninsured patients they treat. And although it's believed states with the most illegal immigrants will face a smaller cut, they will still lose money.

The potential impacts of reform are a hot topic at MD Anderson Cancer Center in Houston. In addition to offering its own charity care, some MD Anderson oncologists volunteer at a county-funded clinic at Lyndon B. Johnson General Hospital that largely treats the uninsured.

"In a sense we've been in the worst-case scenario in Texas for a long time," said Lewis Foxhall, MD Anderson's vice president of health policy in Houston. "The large number of uninsured and the large low-income population creates a very difficult problem for us."

Community clinics are a key part of the reform plan and were supposed to take up some of the slack for hospitals. Clinics received $11 billion in new funding over five years so they could expand to help care for a swell of newly insured who might otherwise overwhelm doctors' offices. But in the first year, $600 million was cut from the centers' usual allocation, leaving many to use the money to fill gaps rather than expand.

There is concern that clinics could themselves be inundated with newly insured patients, forcing many illegal immigrants back to emergency rooms.

Limas, 44, moved to the border town of Alamo 13 years ago with her husband and three daughters. Now single, she supports the family by teaching a citizenship class in Spanish at the local community center and selling cookies and cakes she whips up in her trailer. Soon, she hopes to seek a work permit of her own.

For now, the clinic helps with basic health care needs. If necessary, Limas will return to the emergency room, where the attendants help her fill out paperwork to ensure the government covers the bills she cannot afford.

"They always attended to me," she said, "even though it's slow."

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Sherman can be followed on Twitter at https://twitter.com/chrisshermanAP .

Plushnick-Masti can be followed on Twitter at https://twitter.com/RamitMastiAP .

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Weak German PMI data send shares, euro into reverse

LONDON (Reuters) - Weaker-than-expected European economic data sent the region's shares and the euro into reverse on Friday, as hopes of a quick recovery by the struggling bloc were left looking fragile.

Disappointing German manufacturing sector figures overshadowed a small pick-up in the wider euro zone purchasing manager index, data which polls around 5,000 businesses across the 17-nation bloc and is viewed as a reliable growth indicator.

The German manufacturing sector slipped to 46.3 in December from 46.8 the previous month, remaining well below the 50 threshold that divides growth from contraction and missing the consensus forecast in a Reuters poll for 47.2.

It saw European shares <.stoxx50e> drop back to a near-flat 2628.56 points. By 4:30 a.m. ET London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> were down between 0.1 and 0.2 percent having all opened in positive territory.

"All in all, the picture for the EMU (euro zone) economy has not changed much after today's data," said Annalisa Piazza, an economist at Newedge Strategy.

"EMU GDP is expected to continue to contract in Q4-12 and there are no signs of improvement for the first part of next year."

Following a mixed session for Asian equities, the MSCI index of global stocks <.miwd00000pus> was down fractionally at 336.73 points, following a 6 percent rise over the last three weeks.

In the currency market, the PMI data also saw the euro lose its early momentum and slide back below $1.31.

Mirroring the move, German government bonds clawed back into the black having dipped during early trading. By 4:20 a.m. ET German bunds were up 4 ticks at 145.11.

The news was not all gloomy, however. After more than eight hours of late-night talks at a summit in Brussels, EU leaders promised to push ahead with a pan-euro zone mechanism to wind down problem banks.

It is something many crisis observers believe could help finally break the toxic link between troubled banks and the crippling impact their bailouts typically have on national finances.

A deteriorating business sentiment survey and expectations that the Bank of Japan will ease policy further to support the weak economy next week pushed the yen to a near 9-month low against the dollar and an 8-month low against the euro.

China shares outperformed Asian peers after the HSBC flash purchasing managers' index for December hit a 14-month high of 50.9, the fifth straight monthly gain, underlining the world number two economy's improving growth prospects.

The data help lift commodity markets, with copper and oil both edging up, albeit staying within their tight recent ranges.

"We're seeing positive (China) PMI, industrial data and they are all pointing to the direction of an economic recovery," said Sijin Cheng, a commodities analyst at Barclays Capital.

(Additional reporting by Sudip Kar-Gupta; editing by Philippa Fletcher)

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For North Korea, next step is a nuclear test

SEOUL (Reuters) - North Korea's next step after rattling the world by putting a satellite into orbit for the first time will likely be a nuclear test, the third conducted by the reclusive and unpredictable state.

A nuclear test would be the logical follow-up to Wednesday's successful rocket launch, analysts said. The North's 2009 test came on May 25, a month after a rocket launch.

For the North and its absolute ruler Kim Jong-un, the costs of the rocket program and its allied nuclear weapons efforts - estimated by South Korea's government at $2.8-$3.2 billion since 1998 - and the risk of additional U.N. or unilateral sanctions are simply not part of the calculation.

"North Korea will insist any sanctions are unjust, and if sanctions get toughened, the likelihood of North Korea carrying out a nuclear test is high," said Baek Seung-joo of the Korea Institute of Defense Analyses.

The United Nations Security Council is to discuss how to respond to the launch, which it says is a breach of sanctions imposed in 2006 and 2009 that banned the isolated and impoverished state from missile and nuclear developments in the wake of its two nuclear weapons tests.

The only surprise is that the Security Council appears to believe it can dissuade Pyongyang, now on its third hereditary ruler since its foundation in 1948, from further nuclear or rocket tests.

Even China, the North's only major diplomatic backer, has limited clout on a state whose policy of self reliance is backed up by an ideology that states: "No matter how precious peace is, we will never beg for peace. Peace lies at the end of the barrel of our gun."

As recently as August, North Korea showed it was well aware of how a second rocket launch this year, after a failed attempt in April, would be received in Washington.

"It is true that both satellite carrier rocket and (a) missile with warhead use similar technology," its Foreign Ministry said in an eight-page statement carried by state news agency KCNA on August 31.

"The U.S. saw our satellite carrier rocket as a long-range missile that would one day reach the U.S. because it regards the DPRK (Democratic Peoples Republic of Korea) as an enemy."

CASH IN EXCHANGED FOR COLDER WAR

The end-game for the North is a formal peace treaty with Washington, diplomatic recognition and bundles of cash to help bolster its moribund economy.

"They might hope that the U.S. will finally face the unpleasant reality and will start negotiations aimed at slowing down or freezing, but not reversing, their nuclear and missile programs," said Andrei Lankov, a North Korea expert at Kookmin University in Seoul.

"If such a deal is possible, mere cognition is not enough. The U.S. will have to pay, will have to provide generous 'aid' as a reward for North Koreans' willingness to slow down or stop for a while."

Recent commercially available satellite imagery shows that North Korea has rebuilt an old road leading to its nuclear test site in the mountainous northeast of the country. It has also shoveled away snow and dirt from one of the entrances to the test tunnel as recently as November.

At the same time as developing its nuclear weapons test site, the North has pushed ahead with what it says is a civil nuclear program.

At the end of November, the International Atomic Energy Agency (IAEA) said the construction of a light water reactor was moving ahead and that North Korea had largely completed work on the exterior of the main buildings.

North Korea says it needs nuclear power to provide electricity, but has also boasted of its nuclear deterrence capability and has traded nuclear technology with Syria, Libya and probably Pakistan, according to U.S. intelligence reports.

It terms its nuclear weapons program a "treasured sword".

The missile and the nuclear tests both serve as a "shop window" for Pyongyang's technology and Kookmin's Lankov adds that the attractions for other states could rise if North Korea carries out a test using highly enriched uranium (HEU).

In its two nuclear tests so far, the North has used plutonium, of which it has limited stocks. However it sits on vast reserves of uranium minerals, which could give it a second path to a nuclear weapon.

"An HEU-based device will have a great political impact, since it will demonstrate that North Korean engineers know how to enrich uranium, and this knowledge is in high demand among aspiring nuclear states," Lankov said.

(Editing by Raju Gopalakrishnan)

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Tevin Hunte Is 'So Happy' After His Voice Elimination

TV Watch

The Voice

By Jessica Herndon and Julia Haskins

12/12/2012 at 07:45 PM EST

Team Cee Lo's Trevin Hunte was eliminated on Tuesday's episode of The Voice, but the soulful singer isn't letting the end of this journey hold him back.

"I feel like the best person on the planet Earth. I am so happy and excited to be honest," Hunte told PEOPLE after the show. I feel like a weight has been lifted. Being away from family and friends and what you're used to was definitely a hard thing for me."

Hunte is looking forward to his mom's cooking and seeing his friends back home, and he won't waste a second wondering what if he'd made it further.

"I have no regrets. I am glad that I took a leap of faith and auditioned," he said. "I auditioned for American Idol and told my family I didn't have the strength to do it again. But I am definitely happy and excited that I made it this far."

And he still has a long way to go. "I'm only 18," he said. "I'm just really excited."

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Dozens sue pharmacy, but compensation uncertain

NASHVILLE, Tenn. (AP) — Dennis O'Brien rubs his head as he details ailments triggered by the fungal meningitis he developed after a series of steroid shots in his neck: nausea, vomiting, dizziness, drowsiness, blurred vision, exhaustion and trouble with his speech and attention.

He estimates the disease has cost him and his wife thousands of dollars in out-of-pocket expenses and her lost wages, including time spent on 6-hour round trip weekly visits to the hospital. They've filed a lawsuit seeking $4 million in damages from the Massachusetts pharmacy that supplied the steroid injections, but it could take years for them to get any money back and they may never get enough to cover their expenses. The same is true for dozens of others who have sued the New England Compounding Center.

"I don't have a life anymore. My life is a meningitis life," the 59-year-old former school teacher said, adding that he's grateful he survived.

His is one of at least 50 federal lawsuits in nine states that have been filed against NECC, and more are being filed in state courts every day. More than 500 people have gotten sick after receiving injections prepared by the pharmacy.

The lawsuits allege that NECC negligently produced a defective and dangerous product and seek millions to repay families for the death of spouses, physically painful recoveries, lost wages and mental and emotional suffering. Thirty-seven people have died in the outbreak.

"The truth is the chance of recovering damages from NECC is extremely low," said John Day, a Nashville attorney who represents several patients who have been sickened by fungal meningitis.

To streamline the process, attorneys on both sides are asking to have a single judge preside over the pretrial and discovery phases for all of the federal lawsuits.

This approach, called multidistrict litigation, would prevent inconsistent pretrial rulings and conserve resources of all parties. But unlike a class-action case, those lawsuits would eventually be returned to judges in their original district for trial, according to Brian Fitzpatrick, a law professor at Vanderbilt University Law School in Nashville.

Even with this approach, Fitzpatrick noted that federal litigation is very slow, and gathering all the evidence, records and depositions during the discovery phase could take months or years.

"Most of the time what happens is once they are consolidated for pretrial proceedings, there is a settlement, a global settlement between all the lawyers and the defendants before anything is shipped back for trial," he said.

A lawyer representing NECC, Frederick H. Fern, described the consolidation process as an important step.

"A Boston venue is probably the best scenario," Fern said in an email. "That's where the parties, witnesses and documents are located, and where the acts subject to these complaints occurred."

Complicating efforts to recover damages, attorneys for the patients said, NECC is a small private company that has now recalled all its products and laid off its workers. The company's pharmacy licenses have been surrendered, and it's unclear whether NECC had adequate liability insurance.

Fern said NECC has insurance, but they were still determining what the policy covers.

But Day says, "It's clear to me that at the end of the day, NECC is not going to have sufficient assets to compensate any of these people, not even 1 percent."

As a result, many attorneys are seeking compensation from other parties. Among the additional defendants named in lawsuits are NECC pharmacist and co-founder Barry Cadden; co-founder Greg Conigliaro; sister company Ameridose and its marketing and support arm, Medical Sales Management.

Founded in 2006 by Cadden and Conigliaro, Ameridose would eventually report annual revenue of $100 million. An NECC spokesman didn't respond to a request for the pharmacy's revenue.

While Federal Drug Administration regulators have also found contamination issues at Westborough, Mass.-based Ameridose, the FDA has said it has not connected Ameridose drugs to infection or illness.

Under tort law, a lawsuit has to prove a defendant has a potential liability, which in this case could be anyone involved in the medical procedure. However, any such suit could take years and ultimately may not be successful.

"I would not be surprised if doctors, hospitals, people that actually injected the drugs, the people that bought the drugs from the compounding company, many of those people will also be sued," said Fitzpatrick.

Plaintiffs' attorneys said they're considering that option but want more information on the relationships between the compounding pharmacy and the hundreds of hospitals and clinics that received its products.

Day, the attorney in Tennessee, said the clinics and doctors that purchase their drugs from compounding pharmacies or manufacturers could be held liable for negligence because they are in a better position to determine the safety of the medicine than the patients.

"Did they use due care in determining from whom to buy these drugs?" Day said.

Terry Dawes, a Michigan attorney who has filed at least 10 federal lawsuits in the case, said in traditional product liability cases, a pharmaceutical distributor could be liable.

"We are looking at any conceivable sources of recovery for our clients including pharmaceutical supply places that may have dealt with this company in the past," he said.

Ten years ago, seven fungal meningitis illnesses and deaths were linked to injectable steroid from a South Carolina compounding pharmacy. That resulted in fewer than a dozen lawsuits, a scale much smaller than the litigations mounting up against NECC.

Two companies that insured the South Carolina pharmacy and its operators tried unsuccessfully to deny payouts. An appellate court ruled against their argument that the pharmacy willfully violated state regulations by making multiple vials of the drug without specific prescriptions, but the opinion was unpublished and doesn't set a precedent for the current litigation.

The lawsuits represent a way for patients and their families recover expenses, but also to hold the pharmacy and others accountable for the incalculable emotional and physical toll of the disease.

A binder of snapshots shows what life is like in the O'Briens' rural Fentress County, Tenn., home: Dennis hooked up to an IV, Dennis in an antibiotics stupor, bruises on his body from injections and blood tests. He's had three spinal taps. His 11-day stay in the hospital cost over $100,000, which was covered by health insurance.

His wife said she sometimes quietly checks at night to see whether her husband of 35 years is still breathing.

"In my mind, I thought we were going to fight this and get over it. But we are not ever going to get over it," said Kaye O'Brien.

Marjorie Norwood, a 59-year-old grandmother of three who lives in Ethridge, Tenn., has spent just shy of two months total in the hospital in Nashville battling fungal meningitis after receiving a steroid injection in her back. She was allowed to come home for almost a week around Thanksgiving, but was readmitted after her symptoms worsened.

Family members are still dealing with much uncertainty about her recovery, but they have not filed a lawsuit, said their attorney Mark Chalos. He said Norwood will likely be sent to a rehabilitation facility after her second stay in the hospital rather than return home again.

Marjorie Norwood's husband, an autoworker, has taken time off work to care for her and they depend on his income and insurance.

"It doesn't just change her life, it changes everyone else's life around her because we care about her and want her to be happy and well and have everything that she needs," said her daughter, Melanie Norwood.

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Stock futures point to flat-to-lower start

LONDON (Reuters) - Stock futures pointed to a flat-to-lower open on Wall Street on Thursday, with futures for the S&P 500 down 0.1 percent at 0950 GMT (4.50 a.m. ET).

Contracts on the Dow Jones and the Nasdaq 100 were flat in percentage terms.

Japan's Nikkei <.n225> average surged above 9,700 for the first time in eight months, led by exporters, as the yen fell to a multi-month low on mounting expectations of aggressive monetary easing by the Bank of Japan after a general election at the weekend.

European shares slipped on Thursday after persistent concern about U.S. austerity measures that could hit growth in the world's largest economy overshadowed fresh stimulus steps from the Federal Reserve.

Google's navigation tool has returned to the iPhone, months after Apple's home-grown mapping service flopped, prompting user complaints, the firing of an executive and a public apology from Apple's CEO. [ID:nL1E8ND0P2]

Adobe Systems , the maker of Photoshop software, reports results, expected to show earnings per share fell to $0.57 in its fourth quarter, from $0.67 one year earlier.

GrainCorp Ltd on Thursday rejected a sweetened $2.9 billion bid from Archer Daniels Midland , putting pressure on the U.S. agribusiness giant to boost its offer for Australia's last major independent grains handler.

Knight Capital Group Inc expects to make a decision on its future ownership by early next week, the Wall Street Journal reported on Thursday, citing people familiar with the matter.

The U.S. unit of Britain's BAE Systems Plc said it has won a contract valued at up to $400 million to maintain and service more than 300 U.S. Navy trainer aircraft, beating out incumbent Sikorsky Aircraft, a unit of United Technologies , and L-3 Communications .

The Pentagon will pay about 4 percent less for each new Lockheed Martin Corp F-35A fighter jet when it signs a deal worth $3.8 billion with the No. 1 U.S. defense contractor on Friday, according to sources familiar with the deal.

American Airlines creditors want a potential merger with US Airways Group Inc to be an all-stock deal rather than one that pays some claims in cash, three people familiar with the matter said, in a move that underscores confidence in a merged airline.

Solar installer SolarCity is set to begin trading on the Nasdaq after halving the value of its initial public offering. The deal has been highly anticipated in clean tech and venture capital circles as alternative energy startups have had a difficult time attracting investor interest.

The U.S. Labor Dept releases first-time claims for jobless benefits for the week ended December 8 at 1330 GMT (8.30 a.m. ET). They were expected to show 370,000 new filings, a repeat of the previous weeks figure.

The U.S. Commerce Dept's November retail sales, also due out 1330 GMT (8.30 a.m. ET), were forecast to show a 0.5 percent rise, compared with a 0.3 percent decrease in October. Excluding automobiles, sales are expected to be unchanged, a repeat of the October level.

Producer prices were forecast to show a 0.5 percent decrease compared with a 0.2 percent drop in October. Excluding volatile food and energy items, PPI is expected to rise 0.2 percent versus with a 0.2 percent decrease in October.

The Dow Jones industrial average <.dji> slipped 2.99 points, or 0.02 percent, to 13,245.45 on Wednesday. The Standard & Poor's 500 Index <.spx> inched up just 0.64 of a point, or 0.04 percent, to 1,428.48. But the Nasdaq Composite Index <.ixic> shed 8.49 points, or 0.28 percent, to end at 3,013.81.

(Reporting By Francesco Canepa. Editing by Jeremy Gaunt.)

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North Korea's new leader burnishes credentials with rocket

SEOUL/TOKYO (Reuters) - North Korea successfully launched a rocket on Wednesday, boosting the credentials of its new leader and stepping up the threat the isolated and impoverished state poses to its opponents.

The rocket, which North Korea says put a weather satellite into orbit, has been labeled by the United States, South Korea and Japan as a test of technology that could one day deliver a nuclear warhead capable of hitting targets as far as the continental United States.

"The satellite has entered the planned orbit," a North Korean television news-reader clad in traditional Korean garb triumphantly announced, after which the station played patriotic songs with the lyrics "Chosun (Korea) does what it says".

The rocket was launched just before 10 a.m. Korea time (01000 GMT), according to defense officials in South Korea and Japan, and easily surpassed a failed April launch that flew for less than two minutes.

The North American Aerospace Defense Command (NORAD) said that it "deployed an object that appeared to achieve orbit", the first time an independent body has verified North Korean claims.

North Korea followed what it said was a similar successful launch in 2009 with a nuclear test that prompted the United Nations Security Council to stiffen sanctions that it originally imposed in 2006 after the North's first nuclear test.

The state is banned from developing nuclear and missile-related technology under U.N. resolutions, although Kim Jong-un, the youthful head of state who took power a year ago, is believed to have continued the state's "military first" programs put into place by his deceased father Kim Jong-il.

North Korea lauded Wednesday's launch as celebrating the prowess of all three Kims to rule since it was founded in 1948.

"At a time when great yearnings and reverence for Kim Jong-il pervade the whole country, its scientists and technicians brilliantly carried out his behests to launch a scientific and technological satellite in 2012, the year marking the 100th birth anniversary of President Kim Il Sung," its KCNA news agency said.

Washington condemned Wednesday's launch as a "provocative action" and breach of U.N. rules, while Japan's U.N. envoy called for a Security Council meeting. However, diplomats say further tough sanctions are unlikely to be agreed at the body as China, the North's only major ally, will oppose them.

"The international community must work in a concerted fashion to send North Korea a clear message that its violations of United Nations Security Council resolutions have consequences," the White House said in a statement.

U.S. intelligence has linked North Korea with missile shipments to Iran. Newspapers in Japan and South Korea have reported that Iranian observers were in the North for the launch, something Iran has denied.

Japan's likely next prime minister, Shinzo Abe, who is leading in opinion polls ahead of an election on December 16 and who is known as a North Korea hawk, called on the United Nations to adopt a resolution "strongly criticizing" Pyongyang.

BEIJING BLOCK

China had expressed "deep concern" prior to the launch which was announced a day after a top politburo member, representing new Chinese leader Xi Jinping, met Kim Jong-un in Pyongyang.

On Wednesday its tone was measured, regretting the launch but calling for restraint on possible counter-measures, in line with previous policy when it has effectively vetoed tougher sanctions.

"China believes the Security Council's response should be cautious and moderate, protect the overall peaceful and stable situation on the Korean peninsula, and avoid an escalation of the situation," Chinese Foreign Ministry spokesman Hong Lei told journalists.

Bruce Klingner, a Korea expert at the Heritage Foundation, told a conference call: "China has been the stumbling block to firmer U.N. action and we'll have to see if the new leadership is any different than its predecessors."

A senior adviser to South Korea's president said last week it was unlikely there would be action from the U.N. and that Seoul would expect its allies to tighten sanctions unilaterally.

Kim Jong-un, believed to be 29 years old, took power when his father died on December 17 last year and experts believe the launch was intended to commemorate the first anniversary of the death.

The April launch was timed for the centennial of the birth of Kim Il Sung, the grandfather of its current ruler.

Wednesday's success puts the North ahead of the South which has not managed to get a rocket off the ground.

"This is a considerable boost in establishing the rule of Kim Jong-un," said Cho Min, an expert at the Korea Institute of National Unification.

There have been few indications the secretive and impoverished state, where the United Nations estimates a third of the population is malnourished, has made any advances in opening up economically over the past year.

North Korea remains reliant on minerals exports to China and remittances from tens of thousands of its people working on labor projects overseas.

The 22 million population often needs handouts from defectors who have escaped to South Korea in order to afford basic medicines.

Given the puny size of its economy - per capita income is less than $2,000 a year - one of the few ways the North can attract world attention is by emphasizing its military threat.

Pyongyang wants the United States to resume aid and to recognize it diplomatically, although the April launch scuppered a planned food deal.

It is believed to be some years away from developing a functioning nuclear warhead although it may have enough plutonium for around half a dozen nuclear bombs, according to nuclear experts.

The North has also been enriching uranium, which would give it a second path to nuclear weapons as it sits on vast natural uranium reserves.

"A successful launch puts North Korea closer to the capability to deploy a weaponized missile," said Denny Roy, a senior fellow at the East-West Center in Hawaii.

"But this would still require fitting a weapon to the missile and ensuring a reasonable degree of accuracy. The North Koreans probably do not yet have a nuclear weapon small enough for a missile to carry."

Pyongyang says that its development is part of a civil nuclear program, but has also boasted of it being a "nuclear weapons power".

(This story has been refiled to fix spelling, paragraph 14)

(Additional reporting by Jumin Park and Yoo Choonsik in SEOUL; David Alexander, Matt Spetalnick and Paul Eckert in WASHINGTON; Linda Sieg in TOKYO; Sui-Lee Wee in BEIJING; Rosmarie Francisco in MANILA; Writing by David Chance; Editing by Raju Gopalakrishnan)

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Hugh Hefner's Engagement Ring to Crystal Harris Revealed

By Mike Fleeman

12/11/2012 at 07:00 PM EST

The wedding's back on – though it may be a good idea to save that gift receipt.

Hugh Hefner, 86, officially confirms that he is once again engaged to Crystal Harris, 26, telling his Twitter followers, "I've given Crystal Harris a ring. I love the girl."

And to prove it, Harris posted photos of the big diamond sparkler, calling it "my beautiful ring."

Neither announced a wedding date, though sources tell PEOPLE they're planning to tie the knot at the Playboy Mansion in Los Angeles on New Year's Eve.

Whether that still happens remains to be seen.

This is the plan they had in 2011 – a wedding at the mansion – except that Harris called it off just days before the nuptials were scheduled to happen in front of 300 invited guests.

Hugh Hefner and Crystal Harris

David Livingston / Getty

The onetime Playmate of the Month then ripped Hef's bedroom skills, calling him a two-second man, to which Hefner replied, "I missed a bullet" by not marrying her.

A year later, Hefner's "runaway bunny" bounded back to him.

• Reporting by JENNIFER GARCIA

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DA investigating Texas' troubled $3B cancer agency

AUSTIN, Texas (AP) — Turmoil surrounding an unprecedented $3 billion cancer-fighting effort in Texas worsened Tuesday when its executive director offered his resignation and the state's chief public corruption prosecutor announced an investigation into the beleaguered agency.

No specific criminal allegations are driving the latest probe into the Cancer Prevention and Research Institute of Texas, said Gregg Cox, director of the Travis County district attorney's public integrity unit. But his influential office opened a case only weeks after the embattled agency disclosed that an $11 million grant to a private company bypassed review.

That award is the latest trouble in a tumultuous year for CPRIT, which controls the nation's second-largest pot of cancer research dollars. Amid the mounting problems, the agency announced Tuesday that Executive Director Bill Gimson had submitted his letter of resignation.

"Unfortunately, I have also been placed in a situation where I feel I can no longer be effective," Gimson wrote in a letter dated Monday.

Gimson said the troubles have resulted in "wasted efforts expended in low value activities" at the agency, instead of a focused fight against cancer. Gimson offered to stay on until January, and the agency's board must still approve his request to step down.

His departure would complete a remarkable house-cleaning at CPRIT in a span of just eight months. It began in May, when Dr. Alfred Gilman resigned as chief science officer in protest over a different grant that the Nobel laureate wanted approved by a panel of scientists. He warned it would be "the bomb that destroys CPRIT."

Gilman was followed by Chief Commercialization Officer Jerry Cobbs, whose resignation in November came after an internal audit showed Cobbs included an $11 million proposal in a funding slate without a required outside review of the project's merits. The lucrative grant was given to Dallas-based Peloton Therapeutics, a biomedical startup.

Gimson chalked up Peloton's award to an honest mistake and has said that, to his knowledge, no one associated with CPRIT stood to benefit financially from the company receiving the taxpayer funds. That hasn't satisfied some members of the agency's governing board, who called last week for more assurances that no one personally profited.

Cox said he has been following the agency's problems and his office received a number of concerned phone calls. His department in Austin is charged with prosecuting crimes related to government officials; his most famous cases include winning a conviction against former U.S. House Majority Leader Tom DeLay in 2010 on money laundering charges.

"We have to gather the facts and figure what, if any, crime occurred so that (the investigation) can be focused more," Cox said.

Gimson's resignation letter was dated the same day the Texas attorney general's office also announced its investigation of the agency. Cox said his department would work cooperatively with state investigators, but he made clear the probes would be separate.

Peloton's award marks the second time this year that a lucrative taxpayer-funded grant authorized by CPRIT instigated backlash and raised questions about oversight. The first involved the $20 million grant to M.D. Anderson Cancer Center in Houston that Gilman described as a thin proposal that should have first been scrutinized by an outside panel of scientific peer-reviewers, even though none was required under the agency's rules.

Dozens of the nation's top scientists agreed. They resigned en masse from the agency's peer-review panels along with Gilman. Some accused the agency of "hucksterism" and charting a politically-driven path that was putting commercial product-development above science.

The latest shake-up at CPRIT caught Gilman's successor off-guard. Dr. Margaret Kripke, who was introduced to reporters Tuesday, acknowledged that she wasn't even sure who she would be answering to now that Gimson was stepping down. She said that although she wasn't with the agency when her predecessor announced his resignation, she was aware of the concerns and allegations.

"I don't think people would resign frivolously, so there must be some substance to those concerns," Kripke said.

Kripke also acknowledged the challenge of restocking the peer-review panels after the agency's credibility was so publicly smeared by some of the country's top scientists. She said she took the job because she felt the agency's mission and potential was too important to lose.

Only the National Institutes of Health doles out more cancer research dollars than CPRIT, which has awarded more than $700 million so far.

Gov. Rick Perry told reporters in Houston on Tuesday that he wasn't previously aware of the resignation but said Gimson's decision to step down was his own.

Joining the mounting criticism of CPRIT is the woman credited with brainstorming the idea for the agency in the first place. Cathy Bonner, who served under former Texas Gov. Ann Richards, teamed with cancer survivor Lance Armstrong in selling Texas voters in 2007 on a constitutional amendment to create an unprecedented state-run effort to finance a war on disease.

Now Bonner says politics have sullied an agency that she said was built to fund research, not subsidize private companies.

"There appears to be a cover-up going on," Bonner said.

Peloton has declined comment about its award and has referred questions to CPRIT. The agency has said the company wasn't aware that its application was never scrutinized by an outside panel, as required under agency rules.

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Follow Paul J. Weber on Twitter: www.twitter.com/pauljweber

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Shares, euro supported by hopes for Fed easing

LONDON (Reuters) - European shares and the euro edged higher on Wednesday supported by expectations of more monetary stimulus from the U.S. Federal Reserve when it ends its two-day policy meeting later in the day.

Oil, copper and gold prices were also underpinned by the talk as well as by recent positive economic data from Europe and the United States, while the dollar hovered near multi-month lows against higher yielding currencies.

Markets expect the Fed to expand its current asset purchase scheme, committing to buy $45 billion of U.S. debt and extend its purchases of mortgage-backed debt, to help sustain the fragile U.S. economic recovery.

"We think that more quantitative easing is coming and this next round will be the most aggressive yet," said Ralf Preusser, head of European rates research at BofA Merrill Lynch Global Research.

European shares were on course for an eighth straight day of gain ahead of the Fed decision, which is due after markets in the region close, though the FTSEurofirst 300 index <.fteu3> was barely changed in early trading after hitting an 18-month high on Tuesday.

London's FTSE 100 <.ftse>, Paris's CAC-40 <.fchi> and Frankfurt's DAX <.gdaxi> all opened little changed from the previous day's level, while a 0.1 percent drop in U.S. stock futures hinted at a soft Wall Street open. <.l><.eu><.n/>

Earlier, MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> gained 0.5 percent to hit a fresh 16-month peak, helping push the MSCI world equity index <.miwd00000pus> up 0.1 percent to 337.36 points.

The euro pulled further away from a two-week low of around $1.2876 seen on Friday and stood at $1.3001, hanging on to the gains made after Tuesday's surprisingly strong ZEW economic sentiment index in Germany.

The dollar stood at 80.05 against a basket of major currencies <.dxy>, barely changed from late U.S. levels on Tuesday, but against higher yielding units like the Australian, New Zealand and Canadian dollars, it was drifting lower..

London copper was up 0.5 percent at $8,139.75 a metric ton (1.1023 tons), near two-month highs, while spot gold inched up 0.1 percent to $1,713.15 an ounce.

Brent crude traded above $108 a barrel as the Organization of the Petroleum Exporting Countries (OPEC) prepared to meet in Vienna where it was widely expected to retain its output target of 30 million barrels per day.

Brent futures were up 33 cents at $108.33 a barrel while U.S. crude was 21 cents higher at $85.99 a barrel.

(Reporting by Richard Hubbard. Editing by Alastair Macdonald)

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