The U.S. House of Representatives is, in a rare display of responsibility, about to use its authority to hold hearings to pursue the misuse of power by a lobbying group, AARP.
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timely news article on this issue available at:
http://www.modernhealthcare.com/article/20110330/NEWS/303309974
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announcement of hearings by a House subcommittee:
House Ways and Means Health Subcommittee Chairman Wally Herger (R-CA) and Oversight Subcommittee Chairman Charles Boustany, Jr, MD (R-LA) today announced that the Subcommittees on Health and Oversight will hold a hearing on AARP’s organizational structure, management, and financial growth over the last decade. The hearing will take place on Friday, April 1, 2011, in 1100 Longworth House Office Building, beginning at 9:00 A.M.
AARP, the American Association of Retired Persons, is a non-profit nonpartisan membership organization with a mission to improve the lives of retired Americans. They are the largest organization of its type in the nation. AARP publications are very widely read.
AARP used their magazines and experts to push membership very hard into supporting the “Obama Care” health law signed on March 23, 2010. Of itself, this conduct is questionable for such a large organization with such a wide readership, and it should risk at least a review of the organization's tax status.
There is also the probability of a series conflict of interest for the organization itself. “Obama Care,” over time, eliminates an existing Medicare supplemental insurance subgroup called “Advantage plans.” Advantage plans perform administrative paperwork and bureaucratic duties in exchange for a special, favorable payment schedule. Advantage plans are often used by large corporations and large employers such as state and local governments.
“Obama Care” essentially double-crosses large organization employees and forces them over the next few years into an inferior supplemental insurance once the employees become retirees eligible for Medicare. This is a huge event, politically, because about 25% of Medicare recipients have a supplemental “Advantage plan.”
AARP receives large funds as referral fees from an insurance company, United Health, which labels its Medicare supplemental insurance as endorsed by AARP. This plan is not competitive with an “Advantage plan.” But if Advantage plans are eliminated through law, then AARP benefits by endorsing, and receiving insurance funds from, the insurance firm which has the contractual endorsement. Therefore, prima facie, AARP is politically lobbying for its own financial advantage. And such conduct should trigger a review of the organization's IRS nonprofit status.
Tens of thousands of AARP members, many receiving or eligible for an “Advantage plan” supplement, are furious and have cancelled or failed to renew their AARP membership.
An MD in the U.S. House, Charles Boustany, Jr (R-LA) hates this charade and has used his authority as chairman of an oversight subcommittee to obtain congressional hearings on AARP (details below).
--by the blog author (a retired CPA and specialist in federal tax research, nonprofit taxation and financial reporting, and state government finances)
timely news article on this issue available at:
http://www.modernhealthcare.com/article/20110330/NEWS/303309974
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announcement of hearings by a House subcommittee:
Chairmen Herger and Boustany Announce Hearing on
AARP’s Organizational Structure and Finances
Friday, March 25, 2011
In view of the limited time available to hear from witnesses, oral testimony at this hearing will be from invited witnesses only. However, any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing. A list of invited witnesses will follow.
BACKGROUND:
AARP has long held itself out as the preeminent non-profit organization representing America’s seniors. However, many do not realize that AARP collects billions of dollars each year through the sale and marketing of insurance products. Additionally, memberships on AARP’s corporate for-profit and tax-exempt non-profit boards overlap. Given the Committee’s responsibility to conduct rigorous oversight, jurisdiction over Medicare and sale of Medicare insurance products and sole jurisdiction over the tax code, the Committee will review AARP’s organizational structure and finances.
In announcing this hearing, Chairman Herger said, “AARP is known for being the largest and most well known seniors’ organization in the country. But what Americans don’t know is that AARP was the 4th highest spending lobbying organization between 1998 and 2010 or that the AARP brand dominates the private Medicare insurance market. This hearing is about getting to the bottom of how AARP’s financial interests affect their self-stated mission of enhancing senior’s quality of life. It is important to better understand how AARP’s insurance business overlaps with its advocacy efforts and whether such overlap is appropriate.”
In announcing the hearing, Chairman Boustany said, “As one of the country’s most well-known non-profits, many of America’s seniors trust AARP to represent their interests. But in light of AARP’s dependence on its income from insurance products, there is good reason to question whether AARP is primarily looking out for seniors or just its own bottom line. Before seniors decide whether AARP is worthy of their trust, or their hard-earned dollars, they deserve all of the facts. The purpose of this hearing is to provide a public examination of the facts so seniors can decide those questions for themselves.”
FOCUS OF THE HEARING:
The hearing will examine AARP and its affiliates, revenue, charitable giving, Boards of Directors, and lobbying expenditures.
DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:
Please Note: Any person(s) and/or organization(s) wishing to submit for the hearing record must follow the appropriate link on the hearing page of the Committee website and complete the informational forms. From the Committee homepage, http://waysandmeans.house.gov/, select “Hearings.” Select the hearing for which you would like to submit, and click on the link entitled, “Click here to provide a submission for the record.” Once you have followed the online instructions, submit all requested information. ATTACH your submission as a Word document, in compliance with the formatting requirements listed below, by the close of business on Friday, April 15, 2011. Finally, please note that due to the change in House mail policy, the U.S. Capitol Police will refuse sealed-package deliveries to all House Office Buildings. For questions, or if you encounter technical problems, please call (202) 225-1721 or (202) 225-3625.
FORMATTING REQUIREMENTS:
The Committee relies on electronic submissions for printing the official hearing record. As always, submissions will be included in the record according to the discretion of the Committee. The Committee will not alter the content of your submission, but we reserve the right to format it according to our guidelines. Any submission provided to the Committee by a witness, any supplementary materials submitted for the printed record, and any written comments in response to a request for written comments must conform to the guidelines listed below. Any submission or supplementary item not in compliance with these guidelines will not be printed, but will be maintained in the Committee files for review and use by the Committee.
1. All submissions and supplementary materials must be provided in Word format and MUST NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised that the Committee relies on electronic submissions for printing the official hearing record.
2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material not meeting these specifications will be maintained in the Committee files for review and use by the Committee.
3. All submissions must include a list of all clients, persons and/or organizations on whose behalf the witness appears. A supplemental sheet must accompany each submission listing the name, company, address, telephone, and fax numbers of each witness.
The Committee seeks to make its facilities accessible to persons with disabilities. If you are in need of special accommodations, please call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event (four business days notice is requested). Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above.
Note: All Committee advisories and news releases are available on the World Wide Web at http://www.waysandmeans.house.gov/.
– The above hearing announcement is from:
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