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No more meals, only coffee comes with the AARP spiel

COMMENTARY | December 02, 2010

Gilbert Cranberg wasn't able to find out how much AARP gets for promoting UnitedHealthCare to older people. AARP directed him to the company's tax return, and that wasn't helpful either, except to show that in 2009, AARP reported royalty income of $656,974,323 from all sources.

By Gilbert Cranberg

This is the time of year when older Americans eligible for Medicare are bombarded by ads urging them to attend meetings to get them to enroll in private health plans. The period for switching from traditional Medicare to the plans runs from Nov. 15 to Dec. 31.

My local paper recently ran an ad by AARP “for answers to your questions about Medicare Advantage, Part D and supplemental health plans,” all marketed by UnitedHealthCare, one of the country’s largest private health insurers. If your questions include how much AARP is paid by UnitedHealth they will not be answered. Attend a sales meeting, as I did recently, and it’s evident that AARP and UnitedHealth are joined at the hip. The signage at the meeting site was all about both organizations; the sales person who ran the session distributed a business card with the can’t-miss AARP logo in big red type identifying him as “UnitedHealthCare Advisor.”

The sales pitches at similar meetings in the past were accompanied by elaborate meals. Not this time. The person who took my reservation said, in response to my inquiry, that coffee would be the only refreshment. The government, she laughed, doesn’t want us to bribe you.

Inconspicuously buried at the bottom of the ad was a notice: “UnitedHealthCare pays a royalty fee to AARP for use of the AARP intellectual property.” The UnitedHealthCare Advisor said, he could shed no light on the royalty fee.

A phone call to AARP’s national office in Washington was no more productive. I identified myself as an AARP member and inquired about UnitedHealthCare and AARP financial ties; I was told that I’m not entitled to the information.

A separate inquiry to an AARP spokesman, Andrew Nannis, was a bit more informative. He explained that AARP “considers contractual provisions to be proprietary and confidential….For instance a contract that AARP has negotiated…may contain information that a provider may not want made public for competitive reasons.” Nannis directed me to a site that contained AARP’s tax information. Irving W. Mishkin, a Sarasota CPA and AARP member, studied the AARP return and told me that it showed the organization in 2009 had royalty income of $656,974,323 from all sources. Mishkin said it isn’t possible to determine from the return how much AARP earns from UnitedHealthCare.

Iowa Senator Charles Grassley, ranking Republican on the Senate Finance Committee, has tangled with AARP in the past but his staffers could shed no light on the financial ties between the health-care giant and AARP.

When I described to them how frustrating it was to try to penetrate the secrecy they commiserated and added they didn’t think it was right but doubted that I would get the information.

AARP is a major player in health care and its ties to insurers influence the actions of millions. When the public is urged to buy a health-care product as the result of AARP’s marketing it ought to be informed fully about AARP’s financial interest in sale of the product. If the government can throw its weight around to infuence the refreshments used to entice consumers to buy health insurance surely it ought to require AARP to disclose how much it pockets from sale of the insurance it promotes.

For earlier Nieman Watchdog reports by Gil Cranberg that deal with AARP, click
here and here.


Posted by Michael Valentine
12/06/2010, 12:00 PM

AARP as a whole was a good idea until, they started selling insurance.

When they should have been lobbying for a better medicare they were instead selling a product.

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