Does AARP have a conflict of interest: seniors versus profits marketing healthcare policies?

Mom, apple pie and for seniors – the AARP standing up for the rights of the elderly, getting them discounts and representing their concerns before Congress and state governments.

Believe that, and we will sell you a genuine, surplus, solid gold faucet from the Trump Tower for just five bucks with free shipping.

As they say in the old folks home, you must always Follow the Money!

Sadly, AARP has grown into a marketing and sales firm with a sideline public policy advocacy effort that does not always serve seniors well, according to a recent report by Juniper Research:

For decades, AARP has been accused of questionable business practices from numerous quarters including Federal officials, who suggested a business arrangement AARP proposed (but never implemented) could violate federal criminal statutes, the editorial board of the New York Times, and former AARP employees themselves.1

The organization’s business practices effectively overcharge seniors who purchase insurance coverage from the organization—including Medicare supplemental policies, called Medigap insurance—to fund its own operations, the report concluded.

AARP’s revenue from these sales, and from UnitedHealth, which licenses AARP-branded Medigap and Medicare Advantage coverage, has grown year after year. In nine years since AFCA enactment in 2010, the organization has received nearly $5 billion tax-free in revenue from UnitedHealth.

The report condemns AARP for abandoning its duties to seniors by ignoring the AFCA weaknesses:

While AARP claims that Obamacare ended “discrimination” against individuals with pre-existing conditions, the organization somehow forgot to ensure that the law’s package of insurance changes—including a ban on denying coverage to individuals with pre-existing conditions—applied to its lucrative Medigap policies.2

As a result, some seniors and AARP members with pre-existing conditions often cannot obtain access to AARP-branded Medigap policies, because the organization has put protecting its prime source of revenue over the principles to which it purportedly adheres.

The Affordable Care Act is not open to anyone 65 or older. These seniors are barred from individual or group health insurance, unless it is Medigap or Supplemental, both plan categories endorsed and marketed by AARP.

What does it cost to be #1 (a paid position) on Google, ahead of more than a million other listings?

Juniper urges that the public push Congress to end this conflict of interest:

AARP’s financial conflicts have prompted the organization to abandon its principles on numerous occasions, pursuing financial gain for itself and its partners over the organization’s stated objectives—and its members. Congress should follow up on these facts, and its own prior investigations, by further exploring the unholy alliance between AARP and UnitedHealth Group.

AARP appears to use its editorial pages to direct readers to its royalty products, such as the following:

And here:

Juniper describes the AARP arrangement as a “Profitable Non-Profit.”

Despite the organization’s status as a non-profit tax-exempt entity organized under Section 501(c)(4) of the Internal Revenue Code, AARP has found its business very enriching indeed. According to its 2018 Form 990 filed with the Internal Revenue Service, the organization reported net income—that is, revenues in excess of expenses—of $246,463,998.3 That surplus of nearly a quarter-billion dollars represents a net margin equal to more than 13.4% of AARP’s total revenues.4

…AARP has achieved a total of nearly $1.4 billion in net profits since 2009, achieving financial gains in nine out of those 10 years.5 Moreover, its net revenue margin has averaged nearly 10%, far more than the average profit margin of some industries.6 For instance, of seven major health insurers listed in the Fortune 500, none had a 2018 profit margin exceeding 5.42%.7

In total, AARP received more than $5.3 billion tax free from UnitedHealth Group during 2007 through 2017.

AARP also makes money investing insurance premiums paid by seniors – plenty of money!

“The organization has established a grantor trust, through which it funnels payments for insurance policies issued by UnitedHealth and other insurers, including MetLife, Genworth, and Aetna,” Juniper reported.

AARP invests the funds from when they receive the payments from seniors until when they transfer the payments to UnitedHealth Group and other insurers:

Investing seniors’ premium payments for a short period might seem insignificant. However, given the massive sums involved—the grantor trust processed a total of $11.4 billion in payments from AARP members in 2018—the investment gains quickly add up.

Not only is AARP a thriving organization, it pays its execs very well. In 2018, CEO Jo Ann Jenkins received a total of $1,341,675 in salary, benefits, and other compensation. She wasn’t the first to get the big bucks.

In 2006 CEO, Bill Novelli had more than $2 million in compensation. That was the same year AARP had a nearly $26 million shortfall. When successor, Barry Rand, retired in 2014, he received some $1.7 million in compensation—for working eight months that year.

Juniper reported that CEOs are not the only ones on the gravy train:

A total of 13 AARP employees—officers, key employees, and other highly compensated staff—listed on the organization’s 2018 Form 990 filed with the Internal Revenue Service, all received more than $450,000 in total compensation.

These figures only include the salaries and compensation for key executives for which the IRS requires disclosure. By definition, it does not include other AARP executives, or executives of the AARP Foundation, a separate legal entity with its own salaried officers and staff.

It appears that nearly any job at AARP is a salary gem:

In fact, AARP pays most of its employees far more than the average senior receives in income and/or Social Security benefits. According to its IRS filing, in 2018 more than half (1,128) of AARP’s total employees (2,015) received reportable compensation from the organization in excess of $100,000. Dividing the organization’s total spending on employee compensation in 2018 ($347,536,725) by its number of employees (2,015) reveals that AARP employees received an average of $172,484.80 in salaries, benefits and other compensation.

Coming next Tuesday: How AARP is ignoring your right to a prompt COVID-19 vaccine!

Footnotes (some require subscriptions to read, unfortunately):

[1] Milt Freudenheim, “AARP Dropping Plans for Royalties in a Health Program,” New York Times April 19, 1997,; “Can You Trust the AARP?” New York Times May 20, 1996,; Jerry Markon, “AARP Lobbies Against Medicare Changes That Could Hurt Its Bottom Line,” Washington Post December 4, 2012,

[2] Lynda Flowers and Claire Noel-Miller, “The Ban on Pre-Existing Condition Exclusions Helps Older Americans,” AARP Blog December 28, 2016,

[3] AARP Inc., 2018 Form 990,, p. 1.

[4] Ibid.

[5] AARP Inc., Forms 990, 2009 through 2018. While only the 2016, 2017, and 2018 statements are visible on the organization’s website,, all copies of the AARP Forms 990 are available through a ProPublica database,

[6] Ibid.

[7] Fortune 500, 2019, Health insurers include UnitedHealthGroup, Anthem, Centene, Humana, Cigna, WellCare, and Molina Healthcare. The other Fortune 500 company listed under “Insurance and Managed Care,” Magellan Health, focuses on managing behavioral health issues, as opposed to selling health insurance products to individuals and/or employers.

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