Seniors may think they save money when they buy AARP insurance, but if they take the trouble to compare competing products, they may be paying twice as much.
AARP brought in nearly half a billion dollars in 2007 from fees insurers pay for AARP endorsement. It also gained about $40 million from holding the clients’ premiums for a month and investing them.
The revenue helps pay down the $200 million bond debt that funded the organization’s brass and marble headquarters in Washington, D.C.—which is closed to visitors, purportedly so staff can work.
Royalties and fees now constitute about 43% of AARP’s revenue, up from 11% in 1999.
According to a 2007 Harris poll, AARP ranks third behind Consumer Reports and the American Red Cross as a trusted large advocacy group influencing U.S. politics. AARP is considered the most powerful interest group in the United States.
“They don’t even have to give any campaign contributions,” observes James Thurber, director of the Center for Congressional and Presidential Studies at American University in Washington. “AARP’s enormous clout comes from the threat that they could defeat people in Congress who don’t do what they want.”
AARP lobbied against Bush’s proposed overhaul of Social Security, and for the Medicare prescription drug benefit. When Part D passed, AARP was able to expand its contract with UnitedHealth Group, which underwrites its Medicare supplemental insurance plan.
“I was kind of shocked,” said one member, who found out he was paying $1,079 more for his AARP auto insurance than he would have paid for a Mutual of Omaha policy. “They’re making money on the backs of old people” (Gary Cohn and Darrell Preston, Bloomberg.com 12/4/08).
Additional information:
The false principle behind this problem for physicians and patients alike is the morality of altruism, that the moral life is lived in service to others. The true principle that must be identified and understood to mount an effective opposition is the principle of individual rights and the morality of rational selfishness as its foundation. As long as sacrifice is seen as the moral course no sea of blood nor pile of corpses will be sufficient to disuade men from continuing the sacrifices. Arguing about the complicity of legislators, insurance companies, drug companies and government regulators is wheel spinning. Morality is at the root of the problem. If physicians agree on the morality of sacrifice they have no leg to stand on when opposing the demands of the needy and their self appointed protectors. The conflict is reduced to whining physicians and self righteous critics of physicians. That is a contest we cannot win.
Several years ago when researching auto insurance options online (not having it at all risks high legal penalties even if we thought ourselves capable of self-insuring against damage to others) I saw that AARP (through The Hartford) was not among the lowest cost. In addition there was no way to get the over age 55 discount promoted by The Hartford except by joining AARP – something I most definitely did not want to do, though I was in my late 50s at the time (now 63).
The idea of an umbrella group that supposedly is speaking for its members on a very wide variety of subjects is repugnant to me. I disagree with much of what many others think is the appropriate way of viewing reality and interacting with others – and most of the stands taken by AARP leadership are included. The fact that they lobby politicians in the name of all “senior citizens” – they have this slogan “divided we fall” which promotes the idea of groupism – irritates me when I read/hear of their latest push for legislation that will only increase costs and taxes. It is no wonder that many younger people resent oldsters, who they see as sucking the life from those much younger, limiting their available choices to improve themselves as they mature. Of course the real source of the problem is government with its monopoly on legalized initiation of force used by enforcers to compel adherence to its dictates/rules/laws/orders/etc. Without this ability by government to physically implement those thousands of dictates/rules/laws/orders/etc, a group like AARP could be nothing more than a self-help organization for its members who want to share information among themselves. The organization would have nothing to offer in the way of lobbying services to get money redistributed from others (mostly non-members) to members of the organization.
One need only mentally step back from the image of Washington DC and the many thousands of lobbying organizations (and their hundreds of thousands of employees) representing industries, activities, non-federal governments, and single or limited issue interests of every stripe. The image of a large pack of wild dogs biting at the legs and hind quarters of a struggling mighty elk, and often each other, comes to mind for me – but this is in the nature of non-human animals. Humans have a mental faculty that enables them to project the consequences of their actions. The fact that very few individuals think truly wide viewed and long range is evident in the economic mess of the US and most of the rest of the world.
**Kitty Antonik Wakfer
MoreLife for the rational – http://morelife.org
Reality based tools for more life in quantity and quality
Self-Sovereign Individual Project – http://selfsip.org
Self-sovereignty, rational pursuit of optimal lifetime happiness,
individual responsibility, social preferencing & social contracting
I copied and pasted the article and sent it to my Senators and Congressman by webforms. Usually, within a few months I will get some letters from them—I’m curious to see what they have to say. I doubt they will have some ‘canned’ response ready to send concerning AARP preying on seniors.
I am not shocked. AARP has never really been upfront with people on their offerings. They always say you can save so much on insurance, but if you read the fine print it is a product competing against another product with the same company, The Hartford. Now I see where they are joining up with United Health Care? UHC screwed us out of $25,000 of coverage when I had to take my husband to Mayo Clinic. They have quite a scam going. We had 2 different representatives tell us to go ahead and go to Mayo and have the necessary surgery done. Then when it came time to pay the bill they told us it was “out of network”. The attorney general of New York is suing them because of these practices. UHC owns the company that does “reviews” of the claims and that is a definite conflict of interest. Anyway, about the only thing AARP membership is good for is an 8% discount on motel rooms. Stay away!
I am so disappointed in AARP. I am 75 year old woman.I have also a Medicare card. In 1997 I thouht I need a Supplement Insurance from AARP – insured by United Health Care – I trusted them.
They raise the Premiums every year, now I have to pay every month
$ 212.77 even though pay very little or not even a cent.
I also have a AARP Medicare R/X Plan for my Medication,insured by
United Health Care,I pay every month $39.40 but they pay so little, or
nothing at all. I think, they are ripping off the Elderly.
They are raking Billiones Dollars every year.
I used to belong to AARP until I found out how they really stood on issues, irregardless of what seniors thought. I also checked into auto insurance as they advertise to be able to save seniors so much money…. not true.
I also joined AARP in my 50’s because I thought they were good. I was reading their own propaganda and boy was I fooled. Today I see AARP as a liberal organization with an agenda which matches the radical left. They are power grabbers with no true concerns for the seniors. They should be considered as scammers. The proof is in the insurance scam they are promoting.
This is so strange reading these comments. I have a supplement insurance policy but hospitalization only. I pay $12.50 per month as they just raised it a dollar after many years. I must have ESP because last month I called them thinking to cancel. Since I have it automatically taking out of my account is the reason I told her, ‘let me think about it.’ The amount is small but I didn’t realize they were so liberal to the left. Since I have read this email and coments, I am going to cancel now because I do have Medicare and another great supplemental insurance policy.