Medicare Officials Gave Valuable Inside Information to Investors

Federal Medicare officials held a private briefing for Wall Street insiders in 2009 on the future of specific medical devices, giving the select group insight on impending agency decisions. The information from that meeting could help investors make decisions about a market worth hundreds of millions, according to an account released today by the Project On Government Oversight (POGO).

The previously unreported meeting involving the Center for Medicare and Medicaid Services (CMS) is one of a variety that POGO cites as recent examples of Wall Street investors winning privileged, insider access to senior Washington officials and possibly to confidential government information.

Examples from Medicare, the U.S. Treasury Department, the Federal Reserve, the Department of Education and the Pentagon all show how “Wall Street investors—hedge funds, private equity executives, mutual fund analysts and others—gain special entrée to Washington’s vast federal bureaucracy,” according to the report published on POGO.org.

POGO highlights one previously unreported case in which senior staff at CMS held a private briefing for Wall Street insiders. According to an agency whistleblower, who attended the 2009 meeting, the briefing focused on whether Medicare would reimburse specific medical devices.

The whistleblower was told by a supervisor that meetings with Wall Street investors are “routine” at CMS. The session prompted the whistleblower to file an ethics complaint with CMS and with the Department of Health and Human Services. That complaint and others may have caused or contributed to his firing, an action he says he is fighting through legal and administrative channels. CMS confirmed the meeting took place but said it broke no agency rules.

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