Getting to know HHS and CMS appointees Tom Price and Seema Verma

November 29, 2016
George McLaughlin Director of Solutions Marketing

Donald Trump has made public his appointees for Secretary of Health and Human Services (HHS) and Administrator of the Centers for Medicare and Medicaid Services (CMS).

Ladies and gentlemen, please acquaint yourselves with six-term Republican Congressman (GA), David Price, and high flying healthcare consultant, Seema Verma.

While both appointees still need to be confirmed by the Senate, (Price for HHS and Verma for CMS) thanks to a Republican majority, it’s safe to assume both nominations will eventually become official.

So… what does that mean?

First, in case you aren’t familiar, a quick breakdown on why these appointees matter. (Spoiler alert: They matter a lot.)

The Department of Health and Human Services is a monstrous organization. It oversees 11 operating divisions, including (to name a few) the Food and Drug Administration (FDA), the Centers for Disease Control and Prevention (CDC), the Administration for Children and Families, and the National Institute for Health (NIH). It is the largest grant making agency in the United States and wields an annual budget exceeding a TRILLION dollars. (For those who need help wrapping their head around that number, enjoy.)

Accounting for roughly 90% of that TRILLION dollars (sorry it’s the only way I can write that number) is, you guessed it, the Centers for Medicare and Medicaid Services (CMS). They oversee little things like Medicare, Medicaid, and the Children’s Health Insurance Program. In fact, CMS runs the largest insurance program in the world.

Ok, now that it is clear that these aren’t ceremonial positions, that they represent government organizations that impact the lives of every American, lets look a little closer at both nominees.

Tom Price to head HHS

Tom Price, nominee for Secretary of the HHS, grew up in Dearborn, MI and graduated with an M.D. from the University of Michigan. He completed his residency at Emory University in Atlanta, Georgia and went on to be an orthopedic surgeon in the Atlanta area practicing for 20 years before being elected to the Georgia State Senate in 1996. In 2005, Price was elected to the U.S. House of Representatives where he has served six consecutive terms. Price serves as Chairman of the House Budget Committee and is a member of the House Committee on Ways and Means. He is also a member of numerous caucuses including:

As a member of Congress, Price has proven himself to be a staunch conservative, consistently voting to limit government spending and taking a hard line stance on social issues. I’ve pulled a few healthcare relevant positions he has taken from the website Ontheissues.org for reference (peep the link for more details).

Tom Price’s position on healthcare issues

Price is arguably most famous for his vocal opposition of the Affordable Care Act. His 2009 bill, “Empowering Patients First Act”, is one of the most comprehensive plans available that outlines how the GOP would actually repeal and replace existing legislation. In addition to introducing his own plan and a track record of vehement opposition to all things “Obamacare”, Price is close with House Speaker, Paul Ryan, and has collaborated with him on the “Better Way” proposal that outlines many Republican initiatives including a proposal for the repeal of the Affordable Care Act.

For a pragmatic breakdown of the proposed plans, and their impact on everyday Americans, I highly recommend reading Sarah Kliff’s (VOX.com) exceptional articles. I’d summarize for you but my attempts would pale in comparison so it is better off going direct to the source.

One of Trump’s many campaign promises was the “immediate and complete repeal of Obamacare”. The nomination of Tom Price makes it clear that this was not simply campaign trail bluster to invigorate his base, but a promise he is looking to deliver on—quickly.

Seema Verma to head CMS

As a member of the private sector, Seema Verma’s history isn’t as readily available as Price’s, but she has without a doubt lead a fascinating life.

After receiving her Bachelor’s degree from the University of Maryland, she went on to earn her Master’s degree in Public Health from Johns Hopkins in 1996. Early in her career she worked for the Health & Hospital Corporation of Marion County as VP of planning and at the Association of State and Territorial Health Officials in Washington, DC.

In 2001 she founded the health policy consulting firm SVC, Inc. where she would serve as President and CEO and consult for the states of Iowa, Kentucky, Michigan, Ohio, Maine, Tennessee, and most importantly, Indiana.

Seema Verma’s nomination for head of the CMS makes a lot of sense after you learn of her work in Indiana with Vice President-elect Mike Pence. She is cited as the “architect” of Indiana’s expansion of Medicaid with conservative leaning stipulations in the form of Healthy Indiana Plan 2.0.

What the heck does that mean?

Basically, as part of the Affordable Care Act, the Obama administration offered generous federal funding to states to expand Medicaid coverage in hopes of lowering the uninsured rate and moving towards universal coverage. While blue states happily gobbled this up, red states mostly rejected the initiative because it was associated with “Obamacare”. That’s where Verma comes in.

She worked closely with Mike Pence, then governor of Indiana, to craft a plan that would take advantage of Medicaid expansion through the Affordable Care Act, but do so on terms that appealed to conservatives. What this amounted to was a model that requires beneficiaries to pay for a portion of their care, track their compliance with healthy behaviors, and limit eligibility for unemployed “able-bodied” individuals.

While Healthy Indiana Plan 2.0 has generally been seen as a success, and offers a glimpse into what type of changes she might make as Administrator of the CMS, her work in Indiana isn’t without controversy.

In August, 2014, the IndyStar published a fascinating article detailing Verma’s potential conflict of interest working for both the State of Indiana as well as HP, one of the state’s largest Medicaid vendors. During that time, HP would go on to land more than $500 million in state contracts thanks to Healthy Indiana Plan 2.0’s Medicaid expansion. Verma vehemently denies any wrongdoing but the potential conflict of interest can’t be denied and the story has all the makings of a House of Cards episode, just add ominous music. I’d highly recommend reading Tony Cook’s IndyStar article in full for more details.

As an aside, shoutout to local reporters. An article like this reminds you how important it is to have someone invested at that level. All the respect in the world to the true journalists out there.

What does this mean for the industry?

While the fallout from these nominations and eventual appointments will become more clear in coming months, it couldn’t be more important to understand the background of both of these individuals and prepare for what this means, not only for digital health vendors, but for healthcare as an industry.

What we do know is that this means drastic changes to the Affordable Care Act are coming, and quicker than many may have initially estimated. Millions of Americans are at risk of losing coverage made possible by the ACA and there will be serious gaps to fill no matter what the final language of the law that eventually goes into place is.

We know that a hyper conservative, tea party affiliated individual will now be leading an agency that is responsible for the majority of social welfare and government assistance programs.

Funding for initiatives like the Cancer Moonshot and Precision Medicine Initiative immediately comes into question. What one administration presented as an opportunity for us to come together and aspire towards, the next may immediately defund and write off as another example of bloated government waste.

Both of these appointments mean a drastic change from “business as usual”.

Where I see the most hope in these appointments is through Verma and her ability to modify foundational pieces of the Affordable Care Act like the expansion of Medicaid and make them palatable for Conservatives.

While Democrats will bemoan the changes, programs like those in Indiana have, in general, been compromises that both sides have come to across party lines that facilitated the expansion of coverage. It might not be everything that Dems ever hoped for, but it is certainly better than nothing.

This give and take relationship will continue to exist although the consolidation of power makes it more likely that the pendulum will swing far in the other direction. Something that has potential devastating implications to millions of low income and aging Americans, the extent of which we can pontificate about but don’t yet completely understand.

I simply hope we keep people at the forefront of this discussion and not wage a bloody war of ideals.

So much of the rhetoric lately is around appealing the Affordable Care Act no matter the cost. Cutting off our nose to spite our face simply because it is associated with Obama is so short-sighted it is heart breaking. I hope the Verma appointment means more compromises that take into account both views and finds some sort of middle ground.

We will be keeping an eye on the fallout just like the rest of the healthcare world but one thing is for sure, buckle in everyone, it’s going to be a bumpy ride.

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