The tax-exempt status of AARP (American Association for Retired Persons), an advocacy group dedicated to guarding the interests of senior Americans, has come under question. This is not the first time the group’s status has been scrutinized.

A report co-authored by three Republican House representatives, Rep. Wally Herger (CA), Charles Boustany (LA) and Dave Reichert (WA), has been released on Tuesday, March 26, entitled, “Behind the Veil: the AARP America Doesn’t Know.” Representatives Herger and Reichert are both members of the powerful House Ways and Means committee, which oversees spending and taxes.

AARP has two arms, one which is the advocacy and lobbying group which has been responsible for watching over the rights of senior citizens, and the other which offers products and services to seniors. Over 40 million Americans are members of the AARP. Membership requires payment of yearly dues, and members are entitled to discounts at thousands of merchants and services nationwide with that membership. They may also purchase medical and other insurance plans through the AARP, although AARP doesn’t actually provide the insurance services. That is provided by United Healthcare. Their plans are designed to supplement Medicare deficiencies.

The questions regarding AARP’s tax status stem from the fact that they do turn a profit in the sale of their insurance products, which also require that purchasers be dues-paying members of the association. AARP rebuts this argument by stating that they use these profits to be able to offer low membership dues and to formulate better products and services for the senior segment of the US population, which is growing steadily as the Baby Boomer generation ages.

“We believe AARP operates in direct opposition to their senior membership,” Rep. Herger said at a press conference.

“During this investigation it became very clear that despite its privileged tax-exempt status, in many cases, AARP represents a for-profit entity, in fact, an insurance company,” said Rep. Boustany.

The Republican lawmakers say that their criticism of the AARP has nothing to do with the association’s support of the recent federal health care reforms, which Republicans have generally been against. Instead, they say that what is at issue is the nearly $1 billion in profits that will be earned by the AARP through sales of its supplemental Medicare policies, called Medigap insurance, once the health care reforms are complete. Partial funding for the planned federal subsidies for insurance for the poor will be from money diverted from Medicare spending. The resulting vacuum in coverage could easily by filled by the AARP’s products.

“The real overarching question here that I think that seniors across this country should be asking AARP is, who are you working for? Really? Where is your heart? Are you with the seniors of America?” said Rep. Reichert. “Or are you out to make money for AARP?”

AARP has been very active in its support of the Patient Protection and Affordable Care Act (PPACA), even though many of its members have been critical of that support, due to the decreased Medicare spending aspects of the reforms; many members have dropped their membership with the organization in protest.

The AARP responded to the report defensively. “We are very disappointed in the report and reject its conclusions,” AARP President Lee Hammond rebutted in a statement. “AARP is no more an insurance company than we are an online travel company. The royalties we receive allow us to keep member dues low.”