Conservative Lightning Rod Seema Verma Violated Federal Contracting Rules, HHS Report Reveals

A top Trump official is courting controversy after a Health and Human Services report revealed violation of federal contracting rules. The HSS report, released today, July 16, says Seema Verma, head of the Centers for Medicare and Medicaid Services (CMS) within the Department of Health and Human Services, broke federal rules in directing millions of dollars in publicity contracts, which ultimately benefited GOP-aligned communication specialists. 

The inspector general launched the audit last April, after a Politico report said Verma hired  GOP-connected private consultants costing millions of taxpayer dollars to burnish her image, polish her brand, write her speeches, in addition to traveling with her around the country.

The 70-page report explains how Verma used federal contracts to hire people who went on to manage projects and exercise broad authority within the agency. 

Verma is the protégé of Vice President Mike Pence, who urged President Trump to appoint her to head up the CMS. She has played a key role in the government’s coronavirus response, serving on the White House coronavirus task force led by Pence. The Washington Post reported that under Verma’s leadership, the CMS “has rolled out a number of tele-health, hospital and nursing home rules and regulations over the past several months.”

Prior to heading the CMS, Verma was the founder and CEO of an Indianapolis, Indiana-based health policy consulting company, who made millions of dollars helping then Indiana Governor Mike Pence dismantle Medicaid in the state, according to Planned Parenthood.

Verma has been a lightning rod since the Obama administration with her strident opposition to the Affordable Care Act, or Obamacare. She is arguably one of the most conservative among Indian American Republicans, along with FCC’s Ajit Pai.

Verma has been a lightning rod since the Obama administration with her strident opposition to the Affordable Care Act, or Obamacare. She is arguably one of the most conservative among Indian American Republicans, along with FCC’s Ajit Pai.

Explaining how the investigation was conducted, the HHS report observes that the inspector general audited three contracts, “totaling $6.4 million, awarded for strategic communications services from June 2017 through April 2019.”

The investigation found out that while CMS prepared the required documentation for awarding contracts for strategic communications services in accordance with the Federal Acquisition Regulation (FAR), the administration and other senior leaders did not administer and manage the contracts in accordance with federal requirements. 

“CMS allowed a subcontractor individual to perform inherently governmental functions, such as making managerial decisions and directing CMS employees,” the report noted, adding that this put the government “at increased risk for waste and abuse.” It also called on CMS and HHS to take nine actions to address “significant deficiencies” identified in the report.

The March 29 Politico report, ahead of the April 5 HHS investigation, noted that the CMS “funding came through a $2.25 million contract with Porter Novelli, an international public relations firm,” and that “the consultants who received subcontracts include Pam Stevens, a longtime Republican media adviser who helped arrange media sit-downs for Verma; Marcus Barlow, a longtime ally of Verma who helped write her speeches and set strategy; and Nahigian Strategies, which helped Verma unveil announcements and whose staff accompanied her when she traveled.”

However, the report concludes that the CMS did not concur with the findings. News reports say Verma, in a written response to the inspector general’s findings, refuted the charges and chided it for conducting such an investigation when CMS is focused on responding to the COVID-19 pandemic. 

“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,” she wrote. “The OIG’s incomplete analysis is only compounded by their choice in timing for releasing such a report,” she continued. 

“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.”