AARP won’t acknowledge financial interest in Medicare copay debate

By Matthew Boyle

The AARP, formerly the The American Association of Retired Persons, sent U.S. senators a letter last week asking them to oppose any increases in Medicare copayments.

But the self-described pro-senior group hasn’t acknowledged that it has a financial stake in the debate’s outcome.

Several debt-ceiling plans floated in the House and the Senate have included the possibility of increasing existing copayment amounts or adding copayments to certain Medicare services that haven’t charged them before, including in-home health care.

Another floated idea which could potentially damage the AARP financially is one in which Medigap plans would no longer cover seniors’ Medicare copayments.

Medigap plans are supplemental health insurance coverage options that seniors can purchase in addition to their Medicare plans.

The AARP collects 4.95 percent of every dollar United HealthCare takes in from AARP members’ Medigap plan premiums. Not allowing Medigap plans to cover seniors’ Medicare copayment costs is a disincentive for AARP members to continue purchasing the supplemental coverage.

In its letter to Congress, the AARP made no mention of any financial stake it may have in the debate over changes to Medicare copayment arrangements. An AARP spokesperson refused to answer when The Daily Caller asked for a clarification about whether or not the group believed it could be financially affected by the result.

Instead, the spokesperson told TheDC the group “opposes policies that simply shift costs to seniors in Medicare, rather than addressing rising costs throughout the system.”

“Our advocacy is based on the best interests of older Americans — nothing else,” the spokesperson said in an email. “We are focused on the impact on real people, not the impact on AARP.” (Debt talks at the White House continue)

Rep. Phil Gingrey, Georgia Republican, disagrees. He says the AARP is more interested in protecting its own bottom line than in advocating on behalf of older Americans. “They’re looking after their own interests,” Gingrey told TheDC. “And, when you look at the particulars, then you realize that they get more of their revenue, in fact a lot more, from royalties from selling and endorsing products like Medigap.”

The AARP did not refer to “Medigap” at all in the letter it sent to Senators last week. According to the AARP spokesperson, that’s because the lobbying group believes the Medicare copayment issue is one that matters to seniors regardless of whether they pay for supplemental Medigap insurance.

“We’re concerned that a number of proposals in the deficit debate would simply shift costs to people in Medicare — both those with and those without supplemental coverage,” the spokesperson said.

Gingrey believes thinks the AARP is protecting what he sees as a sizable financial stake in this battle, and is disappointed the interest group won’t admit it.

“This organization gets royalties every time they [United HealthCare] sell a policy,” Gingrey said in a phone interview. “So, it looks to me like, in this letter, they’re more protecting their own interests than they are of the seniors they’re supposed to be representing.”