Congressional Democrats are accusing a top health official in President Donald Trump’s administration of “extensive abuse” of millions of taxpayers’ dollars, in part by retaining a raft of Republican-tied media consultants in an attempt to boost her “personal brand.”
Leaders from four congressional committees, who on Thursday revealed the results of a 17-month investigation into Centers for Medicare and Medicaid Services Administrator Seema Verma’s use of public funds, are now calling on her to “personally reimburse the taxpayers for these inappropriate expenditures.”
The Democrats say they obtained tens of thousands of documents showing dozens of questionable billing statements – including that one consultant, Pam Stevens, billed almost $3,000 for work related to setting up a “Girl’s Night to honor the Administrator” at the home of journalist Susan Page.
The probe was conducted by Democrats on the House Energy and Commerce Committee, House Oversight and Reform Committee, Senate Finance Committee, and Senate Health, Education, Labor and Pensions Committee.
“Our investigation found that Administrator Verma misused funds appropriated by Congress and wasted taxpayer dollars intended to support critical federal health care programs,” the Democratic committee leaders said in a joint statement.
“Congress did not intend for taxpayer dollars to be spent on handpicked communications consultants used to promote Administrator Verma’s public profile and personal brand. Administrator Verma has shown reckless disregard for the public’s trust,” they said.
The Democrats accuse Verma of building a “shadow operation that sidelined CMS’s Office of Communications.” Her cadre of handpicked consultants charged CMS nearly $6 million in less than two years, the 56-page report alleges.
The investigation suggests that CMS “may have violated applicable law governing the agency’s use of appropriated funds” due to Verma’s spending on private consultants. “CMS appears to have made unlawful expenditures in violation of these conditions,” the report says.
Consultants for Verma also failed to comply with standard federal expense protocol, the report says, by providing vague descriptions on invoices and not providing dates for the work.
The report alleges that Verma’s “outsized reliance” on consultants led to redundancies in staffing, particularly on office travel, that created “a significant cost to taxpayers.”
CMS did not immediately respond to CNBC’s request for comment on the probe. The White House did not immediately provide comment.
HHS spokesman Michael Caputo blasted the report in a statement to CNBC.
“This is just another reckless, politically timed, drive-by hit job on a reform-driven Trump Administration official and, by extension, on President Trump himself,” Caputo said. “Administrator Verma will continue the Administration’s unprecedented success transforming the American healthcare system in a manner that ensures free-market, pro-taxpayer health policy innovations and achievements drive public discussion — not partisan smears.”
The Democrats’ findings come two months after the Office of the Inspector General in the Department of Health and Human Services published a report accusing Verma of misusing more than $5 million in taxpayer money to pay politically connected contractors and subcontractors.
CMS, one of the largest agencies in the federal government, oversees the massive public health-care programs Medicare and Medicaid, which provide crucial coverage and services to primarily older and poorer Americans, respectively. The agency also administers the Children’s Health Insurance Program and the Obamacare private health insurance exchanges and the Obamacare program.
Verma was confirmed by the Senate in 2017.
As part of the probe, Democrats obtained tens of thousands of pages of documents from HHS and other parties, conducted interviews with associates of two consulting firms used by CMS, and collected additional information from “databases, court records, and press reports, among other sources.”
The report says Verma was most reliant on consultant Marcus Barlow, who had reportedly been blocked by the White House from becoming the official CMS communications director due to his prior criticisms of Trump. Barlow, who had previously been the spokesman for Verma’s former consulting firm, SVC Inc., “billed CMS for hours that approximated those of a full-time employee while charging a rate that would result in more than double the $179,700 annual salary of CMS’s top communications official,” the report says.
Also featured heavily in the report is Stevens, who organized the November 2018 “Girl’s Night” at the home of Page, USA Today’s Washington, D.C., bureau chief.
Page is scheduled to moderate an upcoming debate between Democratic nominee Joe Biden’s running mate Kamala Harris and Vice President Mike Pence. The Commission on Presidential Debates did not immediately respond to a request for comment. Page did not provide comment.
A spokeswoman for Gannett, the owner of USA Today, told CNBC in a statement that Page “was not paid or reimbursed by the federal government for the Girls Night event held at her home,” and that she was “unaware CMS was being billed for the event.”
“USA TODAY is fully aware of these long-standing events that recognize the accomplishments of women and fall well within the ethical standards that our journalist are expected to uphold,” the spokeswoman, Chrissy Terrell, said in the statement.
Terrell said the events are “routinely hosted by well-respected journalists including Judy Woodruff, Norah O’Donnell, Rita Braver, Andrea Mitchell and others to honor significant accomplishments of both Democratic and Republican Women.”
“All the expenses for these receptions are paid for by the journalists themselves,” Terrell said.
A source familiar with the event told CNBC that Page personally paid a total of $4,025 for catering, plus hundreds more in drinks and tips for wait staff.
The Democrats’ report allege that some of the work detailed in the obtained documents could be illegal forms of “self-aggrandizement.” Such work, the report says, includes matters that personally benefited Verma and not the agency she leads.
The report also touches on a two-page “Executive Visibility Proposal,” drafted by Stevens, to boost Verma’s image by targeting media outlets for potential profile pieces and placement on lists that would portray her as a powerful and influential figure.
Those media targets included “Badass Women of DC,” Glamour’s “Women of the Year Awards” and Washingtonian’s “Most Powerful Women in Washington” list, among others.
Stevens billed CMS at least $13,000 to “pitch” Verma for consideration for awards, panels and other events, according to the report.
— CNBC’s Dan Mangan contributed to this report.