The AARP and Medicare "Reform"

The New York Times (courtesy of the Associated Press) informs us today that the "AARP Faces Revolt Over Medicare Bill". The article notes:

The law sets up competition between traditional Medicare and private plans, beginning in 2010. Activists worry that could lead to the privatization of Medicare and place the elderly in the hands of "insurance sharks" more concerned about profits than quality medical care. Elderly people have also questioned the AARP's motives, because it has a for-profit arm that earns royalties from the sale of health insurance.

Two pieces, not quite put together by the author....

The AARP is already huge in the health, life, and "Medigap" insurance business. Also, the AARP has been positioning itself as a provider of pharmacy services and as a drug vendor. What will this bill do, but put the AARP in the position of being an alternative provider, able to negotiate bulk discounts for member drug purchases, and providing "one stop shopping" for both insurance coverage and medication needs?

You think the AARP's approximately $150 million per year in revenues from insurance sales is impressive? If they manage to capture a significant piece of this new $400 billion Medicare entitlement and massively expand their role as a drug vendor, that's going to look like chump change.

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