Bicameral Health Leaders Urge HHS OIG to Investigate Verma’s Use of Millions in Taxpayer Funds on GOP Consultants

Washington, D.C. – Four House and Senate Democratic Committee leaders today requested that the Department of Health and Human Services' Inspector General Daniel R. Levinson review whether the Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma adhered to federal regulations and ethics requirements regarding the awarding of millions of dollars in questionable CMS contracts to Republican communications consultants for her own benefit.

The request was made to the Inspector General in a letter from House Energy and Commerce Chairman Frank Pallone, Jr. (D-NJ), House Oversight and Reform Chairman Elijah E. Cummings (D-MD), Senate Finance Ranking Member Ron Wyden (D-OR) and Senate HELP Ranking Member Patty Murray (D-WA).

"These contracts are a highly questionable use of taxpayer dollars, and call into question the Administrator's commitment to transparency, ethics, and responsible stewardship of CMS resources," the four Democratic Committee leaders wrote to Levinson. "We ask that you conduct a review to determine whether Administrator Verma's actions regarding these contracts complied with federal regulations and ethics requirements."

According to a recent press report, the subcontracts in question may be part of a $2.25 million contract with Porter Novelli, an international public relations firm. Under Verma's leadership, CMS reportedly has also spent at least $1 million on contracts with Republican-affiliated communications consultants. The consultants reportedly handled Administrator Verma's media calls and wrote her speeches, both of which are functions that CMS's Office of Communications has historically performed. One of the Republican subcontractors reportedly arranged interviews with Administrator Verma that "focused on emphasizing her personal life and her role as a prominent Republican woman."

The four Committee leaders also sent a letter to Administrator Verma demanding answers in an effort to ensure CMS's funds are spent advancing agency initiatives not for the personal benefit of agency political leaders and their well-connected associates.

"You should be spending CMS's resources to ensure Americans have quality health care – not bolstering your own image," the four Committee leaders wrote in their letter to Administrator Verma. "Under your leadership, CMS has eliminated tens of millions of dollars in funding that was intended to raise awareness about health coverage options under the Affordable Care Act and funding for Navigators that assist individuals in gaining coverage. Instead of spending resources to improve health care for everyone in the country, you appear to have steered money to political allies to boost your reputation."

Specifically, the four Committee leaders asked Verma to provide the following information no later than April 12:

• A list of all contracts and subcontracts with Porter Novelli, Nahigian Strategies, Pam Stevens, and Marcus Barlow since January 20, 2017. For each contract or subcontract, please provide a description of the work performed, whether the contract was competitively bid, an explanation as to how and why these companies or consultants were selected, what your role was in the awarding of the contract or subcontract, the amount awarded and obligated, and copies of each contract or subcontract.
• All communications from any individuals in the Office of the Administrator regarding contracts or subcontracts with Porter Novelli, Nahigian Strategies, Pam Stevens, and/or Marcus Barlow since January 20, 2017.
• All communications from any individuals in the Office of Communications regarding the selection of Pam Stevens and Marcus Barlow as subcontractors.

The four leaders are asking the Inspector General to investigate the following:

• To what extent were all applicable Federal Acquisition Regulation provisions, CMS policies and procedures, and federal ethics requirements appropriately followed for the awarding of these contracts and subcontracts to Porter Novelli, Nahigian Strategies, Stevens, and Barlow?
• What were the justification for these contracts and subcontracts, including how and why these consultants were selected, and what was Verma's role in selecting these consultants for the contracts and their awarding?
• What were the total costs of these contracts and subcontracts, including the amount awarded and obligated?
• To what extent could the work under these contracts be performed by CMS's own Office of Communications or policy staff?
• Did any CMS personnel raise concerns about the awarding of these contracts? If so, what were these concerns, and how were they addressed?
• To what extent has CMS ensured that the awarding of contracts adheres to high ethical standards and is free of undue influence from political appointees?

Letter to HHS Inspector General available HERE.

Letter to CMS Administrator Verma available HERE.