Health Care Heavy Hitters

Seema Verma Does Her Homework, Pushes for Beneficiaries To Have More on the Line

The new CMS administrator made her reputation in Indiana with a Medicaid program that she says has “strong personal responsibility mechanisms” built in, including monthly fees.

Timothy Kelley
Senior Contributing Editor

In June’s waning days, when Senate Majority Leader Mitch McConnell was attempting to sell 51 of his fellow Republican Senators on the Better Care Reconciliation Act, a key person reportedly sat in on the face-to-face meetings: President Trump’s CMS administrator, Seema Verma. As CNN said, her job was to “soothe lawmakers’ nerves over changes to Medicaid.”

Big-time soothing was required. Although the act’s proposed changes wouldn’t take full effect for almost eight years, the legislation would have drastically cut federal funds for Medicaid and fundamentally alter the way the program is funded, changing it from a state–federal share to capped federal contributions on a per-capita or block-grant basis. Several GOP senators were said to be more than nervous. As we went to press, the fate of the bill—and the entire Republican effort to junk the ACA and swap in their own program—was in the fog of a political and policy war. But one thing was clear: The administration had deployed a persuader with potent policy-wonk credentials.

Verma, 46, is more than a saleswoman for the GOP health bill; she’s reported to be one of its chief architects too. The second-generation Indian-American is a University of Maryland graduate with a master’s in public health from Johns Hopkins. In 2001, she founded SVC Inc., a health policy consulting firm, which has advised several states on their Medicaid programs. (Upon taking the top post, Verma sold SVC to Health Management Associates in Lansing, Mich., where it became a subsidiary called HMA Medicaid Market Solutions.) Medicaid mavens and others took notice when Verma and her company helped former Indiana Gov. Mitch Daniels create a plan for low-income Hoosiers that took advantage of a Section 1115 waiver. She got some of the credit early in Daniels’ term for sharply reducing a 10% annual growth rate in Medicaid spending. Then came another Republican governor—current Veep Mike Pence—and a new incarnation called Healthy Indiana Plan 2.0, which, with certain special exemptions, doubled as Medicaid expansion. “If I had to describe her in one word it would be ‘innovative,’” says Susan Jo Thomas, executive director of Covering Kids and Families of Indiana, an advocacy organization. Thomas worked with Verma on the Healthy Indiana Plan and, before SVC, on a program that applied good old-fashioned managed care methods to hospital charity care and that was “wildly successful” at saving money, Thomas says. Beneficiaries had an ongoing relationship with a PCP. That meant fewer trips to the emergency room, as well as gatekeeping by the PCP. At the same time, beneficiaries had broader access to health care; previously, eligibility rules pretty much limited adult Medicaid to pregnant women and people with disabilities.

Thomas isn’t privy to the conversations her former collaborator has had with GOP senators this summer, but she’s dead certain of this: Verma has done her homework.

“I’ve watched her negotiate,” says Thomas. “I was incredibly impressed with how prepared she was. She didn’t have knee-jerk reactions. She went out of her way to collect input from patient advocates on our HIP [Healthy Indiana Program] program, for example—including parts that may not have been popular with them.”

“She’s a policy wonk, but she’s far more than that,” says Mitch Roob, who worked with Verma when he headed Indiana’s Family and Social Services Administration, which administers the state’s Medicaid program. Roob, who is now president of a telehealth company called Healthcare Anywhere, says Verma has “practical, on-the-ground knowledge of the way public policy translates into the lives of the people who are receiving health care.” And he praises her work ethic; he recalls her working until 2 a.m. or 3 a.m. on drafts they were preparing for legislators.

Verma grew up in a Democratic household, but her 55–43 confirmation vote as CMS administrator in March drew only three Democratic votes. Indeed, her policy work has helped make Medicaid expansion palatable to conservatives who might otherwise look askance. HIP 2.0, for example, requires a small monthly payment from the beneficiaries, with a six-month lockout for those who don’t pay within a 60-day grace period. “It’s a strong personal responsibility mechanism,” Verma has said.

After being confirmed, she wrote the nation’s governors urging that Medicaid recipients be required to pay premiums, be charged for ER visits, and be encouraged to get jobs or job training. This “skin in the game” approach appeals to conservatives, though critics say it can depress participation among the poor.

“Back home in Indianapolis,” said CNBC in February, “Verma gets high marks for working across the aisle to help secure buy-in to the [state’s] plan from state legislators, the Obama administration, and local health care leaders.” But a 2014 Indianapolis Star article pointed to a possible conflict of interest, noting that Verma was both a consultant for Indiana and an employee of a Hewlett-Packard division that was one of the state’s major Medicaid vendors.

As for her current post at CMS, “I think she’ll do a great job,” says Thomas, “and for the most part not be partisan about it.”

“She’s very resourceful and intelligent,” Indiana Democratic State Rep. Charlie Brown told NPR on her appointment last November. “But the question now becomes, ‘What will be her marching orders as they relate to Medicare and Medicaid?’”

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