America’s Transformative New Organ Donation Rule Goes into Effect Over Objections from Monopolistic Contractors

The Centers for Medicare and Medicaid Services has confirmed to the Project On Government Oversight (POGO) that the most transformative rule in more than 35 years of providing oversight for federal contractors recovering human organs for transplant became effective on March 30, 2021. No public announcement for the change, which could have been delayed or abandoned entirely, has yet been made, but for the first time, the government will require objective data, not industry-reported metrics, to evaluate contractors’ performance, a shift that the Department of Health and Human Services has projected will save more than 7,000 lives annually. The new rule, though in effect now, will first be applied next year. Although the measure already won broad support from Republicans and Democrats in both the House and Senate, it was bitterly opposed by the organ collection industry. Indeed, the fight to ensure its implementation was not a pretty one.

“Who knows Joe and/or Kamala… and how can we get to them BEFORE” patient advocates do?

Coziness is nothing new, even—or especially—at the top of national politics. But attempts at influence-peddling and special access spotlight the public’s worst fears—the search for friends in high places who can be called upon to protect the interests of the powerful, the connected, and, sometimes, the misguided.

The urgent appeal appeared in a November 9, 2020, email sent right after major U.S. media outlets projected Joe Biden’s election victory. Obtained by the Project On Government Oversight, the query came not from a political operative, but from a prominent health care executive, Tom Mone, CEO of OneLegacy, America’s largest human organ procurement organization (OPO). OneLegacy collects vital body parts and tissue for 215 hospitals and 11 transplant centers across greater Los Angeles, and is part of an industry that wants to gut a new rule to improve the organ procurement process for hundreds of thousands of patients in need.

Recipients of Mone’s message included a top Washington lobbyist and CEOs in charge of some of the biggest organ procurement organizations in the country, which operate as government-approved monopolies in their assigned regions. But his nakedly political plea was unrelated to the nitty gritty of obtaining organs for transplant.

Instead, taking aim at the highest levels of government in Washington, it appeared to be an attempt to protect existing prerogatives, perks, and pay scales at many of the United States’ 57 organ procurement organizations, which are part of the nation’s $13 billion transplant industry. Mone’s group has been officially cited by the inspector general at Health and Human Services for using Medicare funds to pay for luxury hotel rooms and Rose Bowl festivities, while he and other CEOs came under government scrutiny last year for accepting millions of dollars in Paycheck Protection Program loans despite their organizations’ large financial reserves. By their own account, Mone and his allies hoped to block or water down reforms that the Biden administration approved. Those reforms will increase the number of organ donations and transplants by holding the industry accountable for its performance.

Asked about his political maneuvering, Mone replied, “We have explored all First Amendment defined opportunities to communicate with public officials about the potentially negative impacts the proposed rule may have. This type of communication is a commonplace and appropriate means for organizations, like ours, to advocate on behalf of those we serve.”

Public filings by organ procurement organizations and their lobbyists indicate that lobbying expenditures have risen by nearly 500% since 2017—in addition to other undisclosed influence spending on law firms and public relations advisors—apparently designed to stop or weaken the proposed changes.

And the administration is not alone in its scrutiny of organ procurement organizations, which are currently subject to bipartisan, bicameral oversight in Congress of performance failures, alleged Medicare fraud, and undisclosed financial conflicts of interest among executives and board members, including an investigation by the House Committee on Oversight and Reform and a congressional subpoena issued by the Senate Finance Committee.

High level participants in increasingly charged industry deliberations told POGO that, behind closed doors, organ procurement executives have impugned individual members of Congress, amid discussions of a “drip, drip, drip” strategy to delay or “slow roll” the two ongoing congressional investigations. Some of those involved in the discussion reportedly said material should be provided in response to requests from Capitol Hill, but “only within limits … so we can just wait it out.”

All of those who spoke to POGO about the details of internal industry discussions—CEOs and senior organ procurement executives alike—said they did not want their names used for fear of retaliation.

Referring to a conference call, multiple sources said a prominent CEO told colleagues the industry should engage in “protracted litigation” to “tie up the government for years” if it tries to decertify any of the organ procurement organizations that fail to meet performance standards required by the proposed reform. Others who heard the remarks say they have expressed concerns internally about the political appearance and potential legal ramifications of pursuing such a hardline strategy.

In another case, two high level executives who say they participated in a similar conference call reported that some top leaders argued for pushing back against Representative Raja Krishnamoorthi (D-IL). In his role as chair of a subcommittee of the House Oversight and Reform Committee, Krishnamoorthi has co-authored letters with Representative Katie Porter (D-CA) asking for information from organ procurement organizations. “The discussion was that … we need to share only the minimum information required, and he’ll eventually go away,” sources told POGO.

Queried on these reports from CEOs and other top executives, all of whom belong to the Association of Organ Procurement Organizations, the association’s president, Joe Ferreira, dismissed the claims as “hearsay” based on “nameless sources and second-hand information.” He asserted that “AOPO is cooperating with the House oversight subcommittee to provide requested information and documents. … Any suggestions to the contrary are false.”

POGO confirmed the information with its sources and stands by its reporting.

Krishnamoorthi, chair of the House Economic and Consumer Policy Subcommittee, told POGO:

“An industry with nothing to hide doesn’t sit around a table and secretly collude to obstruct a congressional investigation. It’s very disturbing to hear that top OPO executives are engaging in this type of behavior. They have deliberately blocked our fact-finding efforts, with the apparent intention to hide their potentially unethical conduct from Congress and the American public. I have a clear message to OneLegacy CEO Tom Mone, and anyone else thinking of delay and obstruction tactics like this: we are not going away. We will use every avenue to get the information needed to complete this investigation. There is an obvious and urgent need for oversight and accountability in this industry. We will continue to fight for patients and donors who deserve better.”

Tension within the industry began to rise markedly last year as members of Congress, supported by patient advocates and experts in the medical community, began pushing the White House to create new, legally enforceable regulations and metrics to boost organ collection productivity.

The Department of Health and Human Services (HHS) published new, final regulations in December 2020, which were greeted by broad, bipartisan support, including from senior HHS officials spanning both the Obama and Trump administrations. The new rule will, for the first time, require the use of objective rather than self-interpreted data, which HHS projects will lead to more than 7,000 additional lifesaving organ transplants every year.

The new rule, originally announced by the previous administration in November 2020, had been subject to review under Biden; its formal approval was first confirmed to POGO. Biden and his advisors grew more familiar with the issue after the Obama White House held an “Organ Summit” in 2016, which catalyzed much of the research into organ collection and ultimately contributed to HHS’s reforms.

Fitting with the president’s current focus on COVID-19, the Biden administration recognized a need for organ procurement reform because the pandemic is expected to produce a sharp rise in demand for kidney and other transplants for patients infected with the virus. On February 1, 2021, Porter, Krishnamoorthi, and Representative Karen Bass (D-CA) wrote to the Biden administration highlighting that “COVID-19 ravages organs and is highly likely to increase the need for organ transplants. ... We must move urgently to implement [organ procurement] reforms today to serve COVID-19 survivors tomorrow.”

Organ procurement organizations have also recently come under scrutiny for providing inferior care to families of color. In an editorial supporting the administration’s organ procurement reforms, Ben Jealous, former president of the NAACP, wrote “People of color, and Black people particularly, are systematically disadvantaged at every step of the system. … Too often, organ procurement organizations do not prioritize organ recovery from Black patients,” who suffer disproportionately from problems with their kidneys—by far the organ most commonly transplanted—and yet are far less likely than white patients to receive lifesaving transplants.

The immediate past chair of the Congressional Black Caucus, Bass, along with Porter and Krishnamoorthi, has similarly criticized organ procurement organizations for engaging in “racial profiling,” and asserted that HHS’s new regulations would help address disproportionate services for people of color.

Yet many industry leaders contend the new regulation will produce only chaos, especially if currently under-performing organ procurement organizations are decertified or forced to reconfigure, which they say could threaten a significant number of them since many are currently failing to meet standards that the new rule would establish.

But even the past president of the Association of Organ Procurement Organizations, the industry’s principal trade group, has publicly refuted this notion, writing in an op-ed: “Some of our colleagues have tried to paint any changes as destabilizing and unprecedented. ... But this is simply not grounded in HHS’s proposal.”

Hopes that the industry would reform itself have simmered for years. Experts have focused on trying to improve organ-recovery rates that vary by nearly 450% between procurement groups. Some perform with high efficiency, recovering more organs, but others do not. Organ procurement mismanagement costs thousands of lives every year.

Critics say the problem stems from the industry’s lack of enforceable performance standards, which removes the incentive to improve. Indeed, no organ procurement organization has ever lost a government contract despite documented failures and fatal lapses in patient safety. They also say that in too many cases organs are simply not recovered even when available.

Other well-documented reports indicate that more than 500 organs have been lost or delayed in transit in the last several years, leading to the conclusion that the United Network for Organ Sharing, the Richmond, Virginia-based overseer of the system, “is approximately 15 times as likely to lose, damage or mishandle an organ as the airline industry is your luggage,” according to a recent article in a leading kidney publication.

The question of what to do about these and other claims has grown increasingly high-profile in recent years. As the struggle moves toward a tipping point, a bipartisan effort by the Senate Finance Committee has turned to subpoena power to investigate the United Network for Organ Sharing, while the House Committee on Oversight and Reform has been firing off letters asking for facts, figures, and explanations from 15 organ procurers around the U.S., as well as an industry trade association.

Doctors in the United States performed 39,000 transplants in 2020 and, in 2019, had the highest per capita transplant rate in the world. Overall donations are up more than 38% in the last five years, while 34 of the organ procurement groups set their all-time organ donation record in 2020, according to the industry’s overseer.

Yet many agree the number of transplants is needlessly low, costing thousands of lives. Additionally, peer-reviewed research finds that the recent increase in organ donation rates in the United States are “almost wholly attributable to the [opioid] epidemic, and reflects the byproduct of a national tragedy, rather than an improved system to be celebrated.”

The escalating battle over what to do about accountability for organ collectors—replete with personal attacks, and political maneuvering—could determine the industry’s course for decades to come. More immediately, it could also influence whether 107,000 men, women, and children currently hoping for transplants get off waiting lists, and receive organs without which they cannot survive.

All organ procurement organizations are 501(c)3 nonprofits with expenses—totaling roughly $3 billion annually—largely covered by taxpayers via Medicare. They also receive fees for being intermediaries between organ donors and patients needing transplants. Previous investigative reporting and government audits have found misspending of taxpayer dollars on private planes, retreats to 5-star hotels, and golf tournaments, among other management perks. More recently, increased funds have gone to trade associations in Washington, which hire lobbyists and public relations firms to influence executive branch decision-makers, Congress, and the public.

Almost a month after sending his “Who knows Joe and/or Kamala?” email, Mone wrote another dated December 6, 2020 (also obtained by POGO), this time in response to predictions that President-elect Biden would nominate California Attorney General Xavier Becerra as Secretary of Health and Human Services. In March, Becerra became the top health official to oversee the organ collection industry, which reports directly to the Centers for Medicare & Medicaid Services.

Referring to news of Becerra’s expected nomination, Mone told a top public relations executive and a bevy of fellow organ procurement organization CEOs that he was “all over it,” and that his OneLegacy board vice chair, Art Torres, “is very close to” Becerra. Mone told the group that he had recently contacted the vice chair and would “report back after we have spoken to him.”

Asked about his email and what he had reported back, Mone offered a blanket denial that Torres had done anything with respect to contacting Becerra or anyone else in the Biden administration, at least not on behalf of OneLegacy. As Mone put it, “OneLegacy Vice Chair, Mr. Art Torres, has not on behalf of OneLegacy communicated with the Biden administration team following their election, nomination or confirmation.” He did not elaborate, and Torres did not respond to a request for comment.

According to tax filings from 2018, the latest available, Mone earned more than $900,000 and paid Torres $50,000 a year. A former chairman of California’s Democratic Party, Torres has known Becerra at least since hiring him as an aide to work in his California Senate office in 1986.

In a letter dated March 3, 2021, five former HHS chief technology officers, Republican and Democratic appointees alike, wrote to Becerra and another senior Biden administration official warning them not to take criticisms from organ procurement executives at face value.

“Having all worked on this issue across our tenures at HHS,” the former officials wrote, “we have all heard similar, baseless claims from OPOs, and have not found them to be grounded in science or made in good faith.” (One former HHS chief technology officer who signed the letter tweeted in 2019 that organ procurement organizations were “some of the most obstructionist stakeholders I’ve ever come across.”)

Despite Mone’s apparent wish to influence Becerra, there is no indication that he has had any success. In Becerra’s confirmation hearing before the Senate Finance Committee, Senator Todd Young (R-IN) asked him specifically if, as HHS Secretary, he would “commit to implementing and enforcing the [new organ procurement regulation] swiftly and forcefully as soon as the review period ends,” in response to which the nominee stated, “we all know we need to increase the supply [of lifesaving organs for transplant] ... and we have to do the oversight.”

Senator Ron Wyden (D-OR), who chairs the Senate Finance Committee, then jumped in, stating that “these are very important issues” and that the Senate Finance Committee “will be continuing” its bipartisan investigation, which he also characterized as a “high-priority matter.”

As the transplant industry’s search for access to Washington decision-makers has escalated, industry trade associations have revved up, one recently hiring the prominent public relations firm Finn Partners, and another bringing in Holland & Knight, a big Washington lobby shop that registered in February, but without yet disclosing its fee. Overall, industry political expenditures have risen from $320,000 in 2017-2018, to nearly $1,500,000 for 2019-2020.

Those numbers are poised to escalate. According to a senior official at the Association of Organ Procurement Organizations, the industry trade group, Holland & Knight is now receiving a fee of roughly $20,000 per month. Other organ collectors are also waging their own lobbying campaign to influence the “OPO regulation.”

A proposal from Finn Partners last year to the Organ Donation Advocacy Group, another trade association, put the struggle in stark terms. The proposal, obtained by POGO, warned prospective clients that “national opinion leaders—politicians, the media, medical professionals,” and others have put the organ procurement community “largely … on the defensive,” arguing, “A major shift in strategy, message and mindset is required.” The firm’s proposed fee: “$20,000 - $25,000/month.”

As part of this new strategy, Katie Seigenthaler, a senior executive at Finn Partners, began sending pitch emails to national editorial boards directing vague personal attacks against the philanthropists who have supported research into the performance of Organ Procurement Organizations.

Seigenthaler told POGO that, “Finn Partners represents the Organ Donation Advocacy Group in raising awareness about the valuable work of Organ Procurement Organizations and in informing the public on the number of American lives saved through organ donation and transplant. We are proud to work alongside this group.”

Around the time Seigenthaler contacted those editorial boards, a lobbyist for the organ procurement group, New Jersey Sharing Network, created a website that questions the motives of philanthropists and patient organizations that have supported reforms, and of media outlets and organizations (including POGO) that have reported on organ procurement. (Note: POGO has chosen not to link to this website because its content is unsubstantiated.)

Even as industry leaders, their lobbyists, and public relations firms battle reform, not everyone in the transplant community is on board. A prominent example is Matthew Wadsworth, CEO of Ohio’s LifeConnection, who is also a member of the Association of Organ Procurement Organizations board of directors.

And that’s because the association has fought back against congressional investigations so aggressively—in part by hiring a lawyer at the Washington firm of Gibson, Dunn & Crutcher, LLP who specializes in navigating such probes. Only last year, the lawyer, Michael D. Bopp, represented Juul Labs, Inc., when it confronted a critical congressional inquiry into its “role in the youth e-cigarette epidemic.” This time, Bopp sent a “confidential” eight-page letter on behalf of the association to Krishnamoorthi and Porter, noting that the industry “Work[s] Tirelessly to Ensure Organ Transplants Occur Efficiently and Safely.” Bopp also called into question facts and figures advanced by supporters of organ industry reform. Wadsworth then wrote his own letter to Krishnamoorthi and Porter rebutting virtually every assertion Bopp had made. As a board member of the association, Wadsworth said, “I wanted to clarify that I had not seen [the Gibson, Dunn] response before it was sent; I do not feel it represents my views, nor do I feel it is grounded in science.”

“Given this,” he continued, “I felt a duty to clarify misstatements and misrepresentations. … The irony is not lost on me that … [an] 8-page letter necessitated an 8-page fact check.”

Bopp’s reply: “Mr. Wadsworth’s allegations are incorrect. The letter I sent on behalf of AOPO contains accurate information meant to help inform the Subcommittee’s investigation. The so-called ‘fact check’ is an advocacy piece consisting largely of opinion and commentary.”

As it confronts congressional probes of many of its members as well as of the industry’s own governing body, there is a growing movement within the association to focus on improving organ recovery and other performance standards rather than on lobbying, which is a current priority. One CEO told POGO that in March alone they held detailed discussions with nine other CEOs about the new approach. Whether such plans lead to an exodus of members from the association remains to be seen. As the CEO put it, “The organization seems to be deeply divided.”

Disclosure: POGO received support from Arnold Ventures in the amount of $400,000 per year for two years to create a database for tracking COVID-19 spending and oversight. In 2017, the Laura and John Arnold Foundation (whose giving is managed by Arnold Ventures) supported peer-reviewed research into the performance of organ procurement organizations.