A top Trump administration health official broke federal contracting rules by using more than $5 million in taxpayer money to pay politically connected contractors and subcontractors, according to an inspector general report released on Thursday.
Seema Verma, head of the $1 trillion Centers for Medicare and Medicaid Services within the Department of Health and Human Services, brought in high-paid contractors from June 2017 to April 2019 to provide strategic communications advice to boost her personal profile, which was first reported by Politico. The IG’s finding details how Verma leveraged personal and political relationships to award personal contracts for work that should have been done by government employees, adding that the agency “paid some questionable costs.”
“CMS allowed a subcontractor individual to perform inherently governmental functions, such as making managerial decisions and directing CMS employees,” the inspector general wrote in the 70-page report. “CMS’s administration of these contracts put the Government at increased risk for waste and abuse.”
Verma, a close ally of Vice President Mike Pence, has played a key role in the government’s coronavirus response, serving on the White House coronavirus task force that Pence leads. CMS has rolled out a number of telehealth, hospital and nursing home rules and regulations over the last several months.
The IG report outlines how Verma relied on the politically-connected contractors instead of the agency’s career civil servants for communications work. It also called on CMS and HHS to take nine actions to address “significant deficiencies” it identified.
Those include determining whether any other HHS contractors or subcontractors are performing inherently government functions, and whether any CMS service contracts are being administered as personal services contracts. It also recommended that HHS provide training to political appointees and senior leaders on proper contract administration.
While HHS concurred with the findings, CMS disagreed.
“The OIG’s conclusions are based on a few handpicked email records, which the OIG did not even attempt to substantiate by interviewing all of the subcontractor employees in question,” Verma wrote in a response to the inspector general.
“The OIG’s incomplete analysis is only compounded by their choice in timing for releasing such a report. As the entire country is dealing with a national public health emergency, CMS staff should be solely focused on responding to an unprecedented global pandemic, but instead had to spend precious time responding to the numerous mischaracterizations and technical inaccuracies in the OIG’s findings and conclusions.”
The Post reported in November how about at least two dozen strategic communications consultants formed an extragovernmental team that helped guide Verma where she wanted to go politically, oversaw some decisions by communication staff and attempted to elevate her profile in ways that go beyond what federal consultants usually are hired to do.
The inspector general report lays out several examples of Verma using the contractors to secure media appearances, write speeches and perform other communications work for her and the agency. It does not name the contractors, but The Post previously reported that they included Pam Stevens, a former media affairs director of the House Republican Conference, who held communication roles in the Ronald Reagan and George W. Bush administrations and briefly worked in Trump’s Office of National Drug Control Policy. Stevens, who charged the government at a rate of $310 an hour for her CMS work, has specialized for many years in promoting Republican women.
They also included Marcus Barlow, a GOP strategist from Indiana with a history in health-care communications, who was Verma’s spokesman while she ran a health-care consulting firm based in Indianapolis. She had sought unsuccessfully to hire Barlow but he was blocked from joining the administration because he had written a column calling Trump “offensive and ignorant.”