Verma-Azar feud extends into coronavirus era

Even in the midst of coronavirus, the Trump administration's top health officials are competing for attention.

Medicare administrator Seema Verma announced on Tuesday night that hospitals could tap $30 billion in “no-strings-attached” coronavirus grants — a move that won her plaudits from health care providers but also one that her rival, Health and Human Services Secretary Alex Azar, had planned to make, according to three people close to the situation. Azar, however, was away from Washington because of the death of his father, and two of his advocates in the agency insist Verma should have waited for his return the next day.

Verma and Azar last year often competed to claim credit for President Donald Trump’s health care initiatives, jousting over public appearances and even seats on the presidential plane. The long-running battle culminated in a December showdown at the White House during which Vice President Mike Pence and then-acting chief of staff Mick Mulvaney attempted to settle the simmering dispute.

While the two health officials briefly tamped down their feud, Verma was initially left off the White House coronavirus task force chaired this year by Azar, before being added to the group after Pence took over leadership at the end of February. The White House has increasingly promoted Verma as a public face of its coronavirus response while steadily sidelining Azar.

On Tuesday, she took the stage at the White House’s daily coronavirus news briefing and made an announcement eagerly anticipated by hospitals and health organizations: “The health care providers that are receiving these dollars can essentially spend that in any way that they see fit.”

But the announcement came after some behind-the-scenes drama, according to three people close to the situation: Verma had privately argued against the plan.

The Medicare chief had opposed the no-strings-attached grants a day earlier in a White House meeting, the three people said, before being overruled by chief of staff Mark Meadows. Verma instead touted her separate plan to lend $34 billion in advance payments to health organizations hit hard by the coronavirus outbreak, a measure included in Congress’ CARES Act package. However, the loans carry a potential 10.25 percent interest rate, alarming hospitals and other providers that worry about paying them back. In a bipartisan request, 34 senators on Wednesday asked the Centers for Medicare & Medicaid Services, which Verma leads, to modify or waive the interest rates.

Azar’s advocates described the episode as another in a long-running series of efforts by Verma — nominally the health secretary's deputy — to seek the spotlight. Verma's announcement was not time-sensitive and could have waited until Azar returned to work on Wednesday, two officials said.

An ally of Verma said she supported the $30 billion no-strings-attached grants and that the Medicare administrator is solely focused on running the program.

Spokespeople for CMS, which Verma oversees, referred questions about the episode to HHS, which said it would not comment on White House meetings.

Meadows did not respond to questions about the episode.

Congress gave Azar and HHS wide latitude in how to divide up the $100 billion rescue fund for hospitals and other providers included in its massive $2.2 trillion coronavirus stimulus package. Officials worked for over a week to hammer out a formula amid furious lobbying from providers.

But with Azar away on Tuesday, Verma instead announced that the first $30 billion tranche would be divided up based on how providers bill Medicare and that a second wave would go to providers who get little, if any, Medicare funding, such as nursing homes and children’s hospitals. Verma made the announcements about an hour into the briefing, after Trump had already left the room.

The health department is set to announce its remaining $75 billion in emergency coronavirus funding for providers in coming days, with $25 billion earmarked for coronavirus hot spots, said one individual with knowledge of the plan.

Adam Cancryn and Rachel Roubein contributed to this report.