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CMS Chief Nomination Is Advancing in Vetting Process, HHS Says

Ethics Office expected to announce agreement with Seema Verma

Seema Verma, seen here arriving at Trump Tower in New York last November, was nominated by President Donald Trump to head the Centers for Medicare and Medicaid Services. (Drew Angerer/Getty Images file photo)
Seema Verma, seen here arriving at Trump Tower in New York last November, was nominated by President Donald Trump to head the Centers for Medicare and Medicaid Services. (Drew Angerer/Getty Images file photo)

The Office of Government Ethics may “very soon” publicly post an agreement with Seema Verma, the Trump administration’s choice to run the Centers for Medicare and Medicaid Services, the Health and Human Services Department told CQ Roll Call. The deal would bring her nomination closer to Senate consideration. 

The agreement would address “all potential conflict issues,” HHS spokesman Matt Lloyd said.

These agreements are a routine step in the vetting of people who serve in top federal posts, as they often have connections to firms and government agencies in their field of expertise. It’s possible that Verma’s agreement will address her widespread contacts with states from her work as a Medicaid consultant. She listed South Carolina, Maine, Nebraska, Iowa and Idaho as her clients while testifying in 2013 before the House Energy and Commerce Committee’s health panel. The website for her Indianapolis-based firm, SVC Inc., also lists Ohio and Kentucky as her clients.

Verma’s work with Indiana on Medicaid has made her a leader among conservatives seeking to reshape the approach of the giant state-federal program.

Rep. Tom Price, who appears on track to become the next HHS secretary, has called Indiana’s program a “national model for state-led Medicaid reforms pertaining to the low-income, able-bodied adult population.” The Georgia Republican praised the Indiana plan for its aim of helping people on Medicaid who are able to work to shift into commercial health insurance. Price also lauded the Indiana program’s “consumer-driven approach.” The model, known as the Healthy Indiana program, uses accounts akin to health savings accounts that are intended to encourage people on Medicaid to more actively manage their own care.

People tapped to lead federal agencies and programs often have many ties to companies and state and federal programs in their fields of expertise. The ethics office works out agreements meant to prevent these connections from creating potential conflicts of interest. 

Former acting CMS Administrator Andy Slavitt, for example, first joined the agency as a top official recruited to help resolve the technical difficulties in starting the health care exchanges created by the 2010 health care law. A 2014 memo with the OGE spelled out the steps that Slavitt, who had been an executive with insurance giant UnitedHealth Group, would need to take to avoid conflicts in matters involving the company. Slavitt later became acting administrator of CMS after the departure of Marilyn Tavenner from that post, and he led the agency through the end of the Obama administration. In 2015, Slavitt said he intended to abide by the previous agreement in a letter spelling out how he would address potential conflicts of interest as CMS chief.

The Senate never acted on President Barack Obama’s nomination for Slavitt to be confirmed as CMS administrator, amid growing partisan rancor over the implementation of the health care law. The Senate had confirmed Tavenner in 2013 in a bipartisan 91-7 vote.

Fights over Medicaid

Democrats likely will differ with Verma on the role of the federal government in Medicaid, although Republicans hold enough Senate seats to overcome even significant opposition from the minority party.

The Senate Finance Committee handles nominations for CMS administrators. The panel’s review of Price’s nomination already highlighted a significant partisan split about the future direction of Medicaid. Democrats are wary of moves toward reducing the federal government’s responsibilities and control of the giant program it shares with states. Republicans are eyeing limits to federal contributions to states as a way to rein in the rising cost of Medicaid. The annual federal tab for the program may rise to $650 billion in fiscal 2027 from about $389 billion in fiscal 2017, according to the Congressional Budget Office.

Texas Rep. Michael C. Burgess, who became chairman this year of the House Energy and Commerce Health Subcommittee, is prioritizing changes to Medicaid. The eight-term Republican led a Tuesday markup of two bills that targeted the relatively few wealthy people who could qualify for Medicaid benefits.

When Verma appeared before Energy and Commerce’s health panel in 2013, she outlined reasons why she favors greater state control of Medicaid programs. The expansion of Medicaid is increasing states’ populations of enrollees who are physically able to work, she said. 

“These regulations disempower individuals from taking responsibility for their health, allow utilization of services without regard for the public cost, and foster dependency,” Verma said in testimony. “While some policies may be appropriate for certain populations, in an era of expansion to nondisabled adults, they must be revisited.”

This story first appeared in CQ on Feb. 7.