Schwarzenegger Meets Secretly with AARP: Healthcare “Reform” by Requiring Everyone to Buy Private Insurance

AARP, the health insurance giant with almost a $billion in revenues, is planning a California-wide education campaign on healthcare reform, and is teaming up with California Governor Schwarzenegger’s campaign to cover the uninsured by forcing them to buy private health insurance. “We don’t want to miss this very unique opportunity in California,” said Mark Beach, a spokesman for the group. SF Chronicle, 4-26-2007

AARP is concluding deals with Aetna and Unitedhealth which it expects to double its HMO membership. Dawn Sweeney, CEO of AARP Services, told reporters that AARP has about 7 million policyholders in a variety of programs, include Medicare prescription drug plans and supplemental insurance that pays for some of the co-payments and deductibles that Medicare does not cover. AARP receives an average of $185 million a year in royalty and revenue payments from its health insurance. AARP expects to double the number of people in its branded products over the seven years and estimates it will garner an additional $1.5 billion in royalty payments as a result. USA Today, 4-17-2007

Pasadena Weekly, April 26, 2007
Schwarzenegger to come to Pasadena Monday for a no-Democrats AARP health care forum

By Joe Piasecki

Gov. Arnold Schwarzenegger

Currently pushing a controversial plan to require all Californians to purchase medical insurance, Gov. Arnold Schwarzenegger will address an unpublicized health care forum hosted by AARP, formerly the American Association of Retired Persons, on Monday at the Pasadena Convention Center, the Weekly has learned.

Not invited to the event, how-ever, are state Democratic leaders with competing health care reform packages up for debate in the Senate and Assembly.

For its part, AARP has “pro-mised not to promote this beyond our membership,” said spokeswoman Charee Gillens, who referred all questions to Schwar-zenegger’s office.

Schwarzenegger spokeswoman Sabrina Lockhart would not comment on the matter, as “We do not confirm the governor’s schedule until the day before an event,” she said.

Gillens did say, however, that the purpose of the invitation-only event was to highlight the need for health care reform.

With both parties silent in the meantime, the real question is, “Is this really a governor’s event or an AARP event?” asked Alicia Trost, spokeswoman for state Senate President Pro Tem Don Perata, a Democrat from Oakland whose health care plan was expected to be heard in committee yesterday.

Both Trost and staff working for Assembly Speaker Fabian Nuñez, a Los Angeles Democrat whose health care reform bill was discussed in legislative committee on Tuesday, confirmed that Perata and Nuñez had not been invited.

The 38-million-member AARP boasts 3 million members in California, making it the largest advocacy organization of its kind in both California and the nation.

National AARP CEO Bill Novelli is also expected to be in Pasadena on Monday.

While being excluded from an AARP-generated event would come as a shock, Trost said Perata would not expect to be part of any Schwarzenegger public relations campaign.

With three competing plans, two of them Democrat-generated, “It’s too early for everyone to be standing up together,” she said.

Although both Democratic bills would not need any support from Republicans to get to the governor’s desk, “We definitely want to work with the administration,” said Trost.

Meanwhile, a spokeswoman for another citizens’ rights group said all three plans are flawed in at least one significant way — protecting the public from price-gouging.

“If you’re an insurance com-pany, you’d have to be breaking out a cigar in celebration over the fact that none of these three new proposals is going to do anything to regulate health insurance rates or make the finances of the for-profit insurance companies any more transparent,” said Judy Dugan, research director for the Santa Monica-based Foundation for Taxpayer and Consumer Rights.

“All twist themselves into knots trying to work within the current system of private health insurance, which is exactly what has gotten us to the point of having 7 million people uninsured in California,” said Dugan.

The Foundation for Taxpayer and Consumer Rights was also the leading proponent of Pasadena’s Measure B, a campaign finance reform law twice-approved by voters that makes it illegal for city officials to accept money or gifts from those who have benefited from their decisions in office.

Schwarzenegger’s health insurance plan would require all Californians to purchase health insurance from a private carrier, but place few controls on the quality and price of coverage. It would also force businesses to spend 4 percent of their payroll costs on providing insurance to employees or paying into a state fund for uninsured workers.

Democratic bills do not mandate health insurance, but would not provide universal coverage, although all children would receive health insurance under those plans.

Nuñez’s bill would not cover single, childless and unemployed adults. It would also exempt the self-employed and businesses with payrolls less than $100,000 per year.

Perata’s bill would also exempt the self-employed, but, according to a report by the Los Angeles Times, would mandate health insurance for individuals making at least $40,840 per year and families of four with earnings at or more than $82,600.

“If we took all the best things from [the three plans] and put them together, then added a nonprofit state-administered insurance choice that would essentially compete in the market and regulate rates, there’d be a pretty good deal there,” said Dugan, a former deputy editorial page editor for the Times.

For more than four years, Los Angeles Democratic state Sen. Sheila Kuehl has been working to create a universal state health insurance system similar to Medicare. Her bill passed the Legislature last year but was vetoed by Schwarzenegger.

The Foundation for Taxpayer and Consumer Rights is supporting legislation by Sacramento Democratic Assemblyman Dave Jones that would require health insurance providers to seek approval for rate increases.

“The fatal flaw of the governor’s plan is the individual mandate requiring people to go out and buy their own insurance in a market that has handed people double-digit premiums year after year while reducing their benefits,” said Dugan.

For many middle-class families, insurance costs could run as high as $1,100 per month for a plan with a $7,500 deductible — “And what good does that do if your kid breaks his arm?” Dugan pointed out.

“It’s entire dependence on a nearly unrestrained private market,” she said.



1 Response to “Schwarzenegger Meets Secretly with AARP: Healthcare “Reform” by Requiring Everyone to Buy Private Insurance”

  1. 1 Cameron June 22, 2007 at 11:53 am

    AARP sure looks like a money making machine.

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