CMS administrator may face ethics investigation on Medicaid waivers

Sen. Ron Wyden, D-Oregon, the top Democrat on the Senate Finance Committee, is asking for an investigation into allegations that CMS Administrator Seema Verma, MPH, has violated her ethics agreement by being involved with Medicaid waivers submitted by states she once counted as clients for her consulting firm.

Before Verma took over at CMS, her private consulting business, SVC Inc., advised several states on their Medicaid programs, including Arkansas, Indiana, Iowa, Kentucky, Ohio, South Carolina and Virginia. Her ethics agreement and the ethics pledge imposed throughout the Trump administration, said she would “seek written authorization to participate personally and substantially” in matters like Medicaid waiver requests from those states and recuse herself from certain waivers.

One of the waivers she would be recused from, Wyden said, was Kentucky’s Section 1115 Medicaid waiver which included work requirements for certain Medicaid beneficiaries—a waiver Verma helped craft when it was submitted to the Obama administration in 2016. Wyden referenced Kentucky Gov. Matt Bevin’s comments that Verma personally contacted state officials to say the waiver had been approved.

“Such a communication … not only represents a potential violation of her ethics agreement, but contradicts previous assurances that she would be recused from participating in matters related to Kentucky’s waiver,” Wyden wrote to HHS counsel Robert Charrow.

Wyden also referenced comments from governors in Arkansas and Iowa that Verma had worked with those states on waiver applications. Additional “compliance concerns” may be forthcoming, he wrote, as more of Verma’s former state clients have either submitted or intend to submit Medicaid waivers now that CMS is approving plans for work requirements.

Along with opening an ethics investigation, Wyden asked Charrow for detailed descriptions on Verma’s communications with states which were once her clients and whether she sought exemptions to her ethics agreement to communicate with those governments.

A HHS spokesperson told the Washington Examiner Wyden had made similar complaints in 2017, and the agency found Verma either received “limited authorizations for a number of states” or didn’t need one.

“The administrator does not have a recusal obligation with regard to her former state clients under the Trump Ethics Pledge, so no Pledge waiver was needed. This was also explained in the July 27, 2017, response to Sen. Wyden,” the spokesperson said.

Ethics concerns have toppled health officials in the Trump administration. Tom Price, MD, resigned as HHS Secretary in September 2017 after it was found he racked up more than $1 million in publicly funded travel costs, including taking charter flights when it appeared cheaper options were available.