By Donald K. Sherman
December 18, 2019

As President Trump finds himself embroiled in an impeachment inquiry based on his repeated ethics abuses, his administrator of the Centers for Medicare and Medicaid Services (CMS) Seema Verma seems determined to steal at least some of the spotlight with her questionable conduct. The mounting ethics issues for Verma highlight the need for the Office of Inspector General (OIG) at the Department of Health and Human Services (HHS), which oversees CMS, to have permanent, Senate-confirmed leadership. The HHS OIG position has been vacant for more than six months, part of the President’s trend of leaving agency watchdog posts empty.

In March, Politico reported that Verma was responsible for “quietly” steering millions of federal taxpayer funds in contracts to Republican communications operatives “including hiring one well-connected GOP media adviser to bolster her public profile.” The contract arrangement was described as “a sharp break from precedent at the agency” and led CMS staffers to raise objections. Verma’s spending drew scrutiny by HHS OIG, which announced its investigation in April, and “[t]he $2.25 million public relations contract was put on hold pending the probe.” OIG’s review focuses on how CMS awarded the contracts for strategic communications work and whether they “complied with applicable federal statutes, regulations, and HHS policies and procedures.” While news of this investigation was certainly a positive development, in May, then-HHS IG Daniel Levinson resigned his post after serving for 15 years. President Trump has yet to nominate a replacement.

Despite Verma’s trouble with HHS OIG earlier this year, she has once again found herself embroiled in controversy. According to Politico, Verma requested to have taxpayer dollars used to “reimburse her for the costs of jewelry, clothing and other possessions, including a $5,900 Ivanka Trump-brand pendant.” Verma filed a $47,000 claim with the Department for lost property on August 20, 2018, after her bags were stolen while she was giving a speech in San Francisco. The overwhelming majority of the claim, approximately $43,000, was for jewelry, including the “Trump-brand pendant, made of gold, prasiolite and diamonds.” According to a spokesperson, the department is “expressly prohibited from reimbursing staff for lost items like jewelry.” Ultimately, HHS reimbursed Verma $2,852.40 for her claim.  

Agency officials have defended Verma, stating that her claim was “perfectly appropriate,” but staff were also “unaware of a federal health employee previously filing a claim as large as $47,000.” More troubling, however, is that according to the Washington Post, in response to damaging reports about her conduct, Verma “assigned top staffers to probe the leaks and concluded they came from the HHS general counsel’s office.” This request raises questions about whether Verma violated the law by using federal funds that pay those staffers’ salaries for her own personal aims. For example, the Purpose Statute prohibits the use of federally appropriated funds for anything other than the “object” (or issue) for which they were appointed, except as otherwise provided by law, with few exceptions. It is unclear whether HHS OIG is currently reviewing Verma’s claim for reimbursement of her jewelry or her commandeering of government employees to investigate leaks about her conduct.

Having a Senate-confirmed inspector general at HHS OIG is necessary to ensure that when ethics scandals arise, especially involving political appointees like Verma, that there is an independent leader with the authority to oversee investigations and demand reforms. News regarding Verma’s questionable conduct at CMS has been coupled with public reports that “other administration officials have complained bitterly about HHS management.” Inspectors General are tasked with policing both ethics abuses and efficiency at federal agencies; HHS appears in dire need. 

Concern regarding IG vacancies is a bipartisan issue and a long-standing challenge for this administration. Three months ago, the Chair and Ranking Member of the Senate Homeland Security and Governmental Affairs Committee led a bipartisan group of senators in writing directly to the President urging him “to take swift action” to address the IG vacancies at multiple agencies including HHS. As the senators wrote, “While many acting IGs have served admirably in the absence of permanent leadership, the lack of a permanent leader threatens to impede the ability of these offices to conduct the oversight and investigations necessary to ensure that taxpayer dollars are protected, public safety risks are identified, and that whistleblowers who expose waste, fraud, and abuse are protected.” They added that “the lack of a permanent IG can create the potential for conflicts of interest and diminish the essential independence of IGs.”

While the President’s ethical misconduct appropriately garners the lion’s share of media, public, and congressional attention, his erosion of the executive branch ethics infrastructure could potentially have longer lasting effects. For example, as of this writing, more than ten percent of the federal Inspector General positions remain vacant including at HHS, but also at the Department of Education and the Department of Treasury. Some of these government watchdogs, like the Department of Defense OIG, have been without Senate-confirmed leadership for the entire duration of the Trump presidency. 

At HHS, it seems clear that having a permanent inspector general confirmed by the Senate would help to address the ethics and management concerns that have been exposed by Verma’s conduct. Perhaps the President is too busy dealing with the fallout from his own ethical misconduct to take action. Or maybe leaving federal agencies without a permanent ethics watchdog is by design.

Photo of Administrator Verma by Brookings.