Sebelius Defends Questionable Behavior

HHS secretary says she did not ask companies regulated by HHS for funds, but could have

Kathleen Sebelius / AP

Health and Human Services (HHS) Secretary Kathleen Sebelius told Congress on Tuesday that she never asked health care executives to help fund programs to implement Obamacare but said that she would have been within her legal rights to do so.

Republicans questioned Sebelius over recent reports that she solicited money from private entities under her regulatory authority during a hearing on HHS budget priorities before the House Committee on Education and the Workforce.

Sebelius said she had only asked two entities, the Robert Wood Johnson Foundation and H&R Block, to contribute to Enroll America, a nonprofit group that will register Americans for benefits under the Affordable Care Act. She said HHS regulates neither.

"I talked to them both about how important this outreach effort was going to be … [and asked] that they consider making contributions to our partner, Enroll America," Sebelius said. "Those are the only two conversations I’ve had about contributing resources to Enroll America."

The Washington Post reported last month that Sebelius had contacted health care executives under her regulatory purview and asked them to contribute to health care implementation efforts. The article quoted one industry official saying Sebelius clearly insinuated that she was looking for financial contributions.

Sebelius admitted she promoted Enroll America to at least three other health care-related entities under her regulatory authority, but stopped short of soliciting funds from them.

"I made a total of 5 phone calls for Enroll America," Sebelius said. "Three of them were to discuss the organization and suggest the entities look at the organization, to Johnson & Johnson, to Ascension Health, and to Kaiser."

Sebelius said that HHS has also been "talking to businesses and pharmaceutical companies and hospitals and insurers about using whatever resources they have to help fulfill what I consider to be an incredible opportunity for up to 30 million Americans to have affordable available healthcare."

The HHS secretary said she could not explain why the health executives might have had the impression that she was asking for financial contributions.

"I can’t answer what they felt," she said. "I made fundraising solicitations to two groups that were not regulated. I did not discuss funding with the other three entities."

The question of whether Sebelius solicited money from health care entities could have legal implications. Office of Government Ethics rules prohibit federal employees from requesting money from a source that "does business or seeks to do business with the employee’s agency," "conducts activities regulated by the employee’s agency," or "has interests that may be substantially affected by performance or nonperformance of the employee’s official duties."

While Sebelius denied that she requested funds from health care executives, she also said it would have been legal for her to do so, and added that there was a precedent for such fundraising.

"[Former HHS] Secretary [Tommy] Thompson and [former HHS Secretary Mike] Leavitt made public private partnerships outreach efforts to make sure Medicare part D enrollment went well," Sebelius said.

"I could legally solicit funds from anybody regulated by our office," she added. "I chose not to do that, but promoting a public-private partnership, you bet."

Sebelius told Congress that she never discussed any of her outreach on behalf of the president’s health care law with anyone in the White House. She also said she was not aware whether her staff or other HHS employees may have solicited money from health care entities.

Richard Painter, who served as Bush’s ethics counsel from 2005 to 2007, told the Washington Free Beacon last month that if Sebelius had requested funding from companies under her regulatory authority, this would likely violate ethics rules.

"To me it’s a clear violation of the rules if you’re asking insurance companies to put money in," Painter said.

Republicans on the Senate Finance Committee, the House Energy and Commerce Committee, and the House Ways and Means Committee have written letters to Sebelius requesting more information and called on the Government Accountability Office to investigate.

The House Energy and Commerce Committee requested information from multiple health care companies about any contact they have had with Sebelius, including Aetna, BlueCross and BlueShield Association, and Kaiser Permanente.

This is not the first time Sebelius has come under scrutiny for alleged ethics violations.

The Office of Special Counsel concluded in 2012 that Sebelius violated the Hatch Act, which prohibits federal employees from engaging in political activity in their official capacity, after she gave a speech supporting President Barack Obama’s reelection at an event.

Update, 5:15 p.m. June 4: This article incorrectly referred to the Robert Wood Johnson Foundation as the Johnson & Johnson foundation. HHS Secretary Kathleen Sebelius testified that she solicited funding from the Robert Wood Johnson Foundation, which was founded by the former head of Johnson & Johnson but is not affiliated with the company.