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The Spectacle Blog

Washington Post Draws Attention to How AARP Would Benefit from Obamacare

By Philip Klein on 10.27.09 @ 9:58AM

Last month, I wrote about how AARP stood to benefit financially from health care legislation moving through Congress. While the group purports to represent the interests of seniors, it has given its full-throated support to Obamacare even though it would cut hundreds of billions from Medicare and older Americans remain more opposed to pending legislation than any other age group. Today, the Washington Post finally caught on, and took a closer look at the dual role the group plays as an lobbyist and an insurance company.

"We're a consumer advocacy organization; we're not an insurance firm," David Certner, the group's legislative director, told the Post.

But as the article notes, the numbers tell a different story:

AARP's ties to the insurance business date to its founding by former educator Ethel Percy Andrus, who started a group to help retired schoolteachers find health insurance in the years before Medicare; the effort led to the creation of AARP in 1958.

Now, the group relies more than ever on payments from auto, health and life insurers, according to financial statements. From 2007 to 2008, AARP royalties from insurance plans, credit cards and other branded products shot up 31 percent -- from less than $500 million to $652 million -- making such fees the primary source of revenue for the group last year, the records show. AARP's annual financial report shows that 63 percent of that, or about $400 million, came from the nation's largest health insurance carrier, UnitedHealth Group, which underwrites four major AARP Medigap policies. Other carriers with AARP-branded plans include Aetna Life Insurance, Genworth Life Insurance and Delta Dental.

AARP has every right to lobby for legislation that would be in its financial interest -- and that would be consistent with the liberal political leanings of its leadership -- but the group should at least be exposed for what it is so that we can stop pretending that they're actually representing older Americans.