The inglorious resignation of Health and Human Services Secretary Tom Price on Friday leaves vacant an extremely powerful position in President Donald Trump’s cabinet. The early frontrunner for the job is Seema Verma, a former healthcare consultant who currently heads the Centers for Medicare and Medicaid Services. Despite this administration’s crusade against Medicaid, Verma actually worked to expand Medicaid in Indiana while she worked as former governor Mike Pence’s protégé in that state. Verma is no friend of the Affordable Care Act, and she has long wished to impose extra burdens on Americans who receive subsidized health care. She is, however, almost certainly the most qualified and least dogmatic official who could possibly lead HHS under the Trump administration. In fact, Verma replacing Price would be a significant improvement.
A key irony of Verma’s career is that, even though she is a conservative Republican, she has spent much of her life helping to implement Obamacare. Verma founded her healthcare consulting firm, SVP Inc., in 2001, and rose to prominence in 2007 through her work with then-Indiana Gov. Mitch Daniels. A somewhat moderate Republican, Daniels asked Verma to craft a Medicaid expansion for underserved populations in the state, especially childless adults. Verma created the Healthy Indiana Plan, which expanded health coverage in the state by about 40,000 people—no small potatoes.
HIP had some decidedly conservative features, including a lifetime cap on benefits and a lack of maternity coverage. But it proved extremely popular, and the state had to put applicants on waitlists while searching for new revenue streams. (It was initially funded, in part, by a cigarette tax hike.) Verma boasted that HIP combined “rugged individualism and the Judeo Christian ethic” by “promoting personal responsibility while providing subsidized health protection to those who can least afford it.”
When Pence entered the governor’s office in 2013, he was staunchly opposed to Medicaid expansion under the ACA. But many health care advocacy groups and centrist Republicans urged Pence to reconsider. HIP was well-liked but expensive to the state, costing Indiana roughly $400 million a year. If the state could transform HIP into an ACA Medicaid expansion, the federal government would cover the costs, allowing the state to insure vastly more people at a lower price. Shortly after entering office, Pence changed his mind—and once again Verma was hired to craft HIP’s successor, which came to be known as HIP 2.0.
Like its predecessor, HIP 2.0 includes conservative features which Pence and Verma touted as “skin in the game.” Enrollees had to pay into “POWER accounts” on a sliding scale based on income. These are basically health savings accounts: Indiana contributes most of the money, but the enrollee also contributes, and uses the funds to pay deductibles. Most HIP 2.0 enrollees don’t have to put much into their POWER accounts—frequently just a few dollars a month. But if they fail to pay this money, they’re punished.
But HIP 2.0 also contained innovations that progressives could celebrate. Most notably, it reimburses doctors at Medicare rates, which are significantly higher than Medicaid rates. This tweak has coaxed many more Indiana providers into accepting Medicaid.
After some haggling, the Obama administration approved HIP 2.0, and it has functioned pretty well for several years. But as soon as Pence brought Verma to Washington, the two worked as hard as they could to blow up their creation. HIP 2.0 survives on Medicaid funding, and every Republican proposal to repeal the ACA would have drained it of funds necessary to survive. Yet Verma and Pence vigorously lobbied legislators to pass each bill, knowing full well that every measure would devastate HIP 2.0. Most recently, the two encouraged senators to vote for Graham-Cassidy, which would have slashed federal healthcare funding for Indiana by $7 billion between 2020 and 2027, denying insurance coverage to about 500,000 Hoosiers over the next decade.
So, it is quite clear that Verma would like to see Obamacare repealed, notwithstanding her years of work expanding the law. As HHS secretary, she would not be an ally to the ACA. But she might not be as much of an enemy as Price, either. So long as the law remains in place, Verma does not appear keen to sabotage it—since doing so would, of course, undermine her own Medicaid work for no real reason other than political hostility toward the law. An unnamed official, who sounded an awful lot like she might be Verma, recently told the New York Times:
We want people to have access to quality health care. I look at it from a patient perspective. I’m a mom. I’ve got two kids. I’ve got a family. I try to look at health care through that lens. What would I want? What would my family want? I think people want stability in the marketplace. We want the healthcare market, the individual marketplace to function and to function well. It is not functioning, the way it is today.
In any Verma reign at HHS, Democrats would have reason for cautious optimism. She is not the secretary that a progressive would pick, but she is not a pure partisan ideologue like Price. Make no mistake—Verma wants Congress to kill the ACA. But until it does, she does not seem opposed to letting the law run smoothly.
