AARP should protect its senior members, not profits
An arrangement between AARP and the UnitedHealth Group medical insurance company has made billions of dollars for both entities. But as a pandemic rages out of control — a pandemic that most profoundly affects the elderly — it’s time to ask whether those profits come at the expense of AARP’s vulnerable membership.
The American Association of Retired Persons, or AARP, is a nonprofit, nonpartisan membership organization for people age 50 and over, dedicated to “enhancing quality of life for all as we age.”
The organization provides a wide range of benefits, special products and services for its members. One of those benefits is a partnership with UnitedHealth Group to sell Medicare-related insurance products to AARP members.
Under the AARP brand, UnitedHealth has been offering Medicare Advantage health benefits and Medicare Part D drug benefits since 1997. AARP receives a 4.95% fee for each plan sold and has received over $4 billion to date. The partnership will continue through at least 2025.
This arrangement may be a lucrative one for both UnitedHealth and AARP, but is it good for AARP’s 38 million members, especially those in Florida, many of whom are among the most vulnerable members of the population?
Critics claim that plans for products such as health care, car insurance and short-term health care insurance are not always fairly priced.
Medicare Advantage was set up by the federal government to allow private insurers to provide a strong social safety net to seniors through managed care plans. This opened the door for these health insurers to access billions of dollars of federal funds, and health insurance companies’ profits continue to rise. UnitedHealth’s revenue rose 6.8% in the first quarter of 2020 to $64 billion, beating analysts’ estimates, and one reason for this, critics argue, is that services and access to care continues to be eroded.
The AARP-UnitedHealth partnership, which is being challenged in the courts, has come under renewed scrutiny because of problems that have arisen during the ongoing pandemic.
Many AARP-UnitedHealth members have been billed for coronavirus testing even though the law requires insurers to cover this without cost-sharing. Others claim that the insurer is making it more difficult to claim for treatment related to COVID-19, even though Congress requires that this too should be covered.
With treatment for COVID-19 not free, and the possibility that treatment could necessitate lengthy hospital stays, patients are at risk of receiving giant bills and thus incurring debt that “will be impossible to pay off,” Rep. Katie Porter (D-Calif ) wrote in a letter to UnitedHealth chairman David Wichmann last month.
UnitedHealth replied that some members received bills for testing “early on,” before specific COVID-19 billing codes had been generated. But it also announced that it would only pay for testing that the company considers “medically necessary.” It is unclear what criteria is used to determine medically necessary and who will pay for tests that aren’t deemed medically necessary.
Only under pressure did UnitedHealth extend its member cost-sharing waiver for the treatment of COVID-19 from May 31 to July 24 and no one knows what will happen after that, but there are still loopholes.
Members can still be billed if they use an out-of-network provider or lab for a test. They can also be billed for medical treatment for long-term complications as a result of the virus, such as heart disease and kidney failure. Doctors are only now discovering the life-threatening and costly long-term health effects. However, insurers are classifying some of these complications as separate from the virus when billing, and this has led to some patients receiving staggering bills.
Even though they are aware of these issues and the surprise billings, AARP has yet to call for any action to protect its members. AARP and UnitedHealth need to step up and be more concerned about people than profits, particularly those people that are the most vulnerable in this difficult time. Shame on them.