Robert Gibbs, on “Fox News Sunday” last weekend, rhetorically asked host Chris Wallace if Obamacare was so bad for seniors, why did the AARP (formerly the American Association of Retired Persons) endorse it?
Only Chicolini in the 1938 Marx brothers classic “Duck Soup” could have come across more unabashed when he asked, “Who you going to believe — me or your own eyes?” Here is a possible answer that may enlighten the administration’s former spokesman: revenue.
AARP derives a majority of its income from two sources: government grants approved by administration functionaries and the sale of supposedly discounted services. Less than a quarter of its revenue comes from membership dues. If the risk of losing grant revenue seems too far-fetched or is insufficient motive for AARP’s endorsement, then Mr. Gibbs should read on.
Foremost in AARP’s offering of services is the sale of their supplemental health insurance through United Healthcare. This insurance is blatantly advertised to fill the gap between the escalating health costs of seniors and Medicare shortcomings.
It doesn’t take a logician to understand that by gutting more than $700 billion from the cash-strapped Medicare program, services and coverage will decrease and AARP’s member base will be driven to buy supplemental insurance from companies like United Healthcare. Perhaps Mr. Gibbs missed this angle because when AARP’s CEO came out for Obamacare in 2009, his endorsement lacked any disclosure of AARP’s pecuniary interest.
Still, thousands of members saw the endorsement as a betrayal and turned in their memberships. As an update to this treachery and perhaps a preview of what may await seniors in the future, the administration has subsequently granted a waiver to AARP. That action exempts AARP (unlike other insurers) from having to defend any rate hikes for the policies it sells to its senior membership.