Monday, February 19, 2018

The Case of the Brew Master's Plot - Was the Veterans Affairs Secretary's Travel Spending Scandalous, or Was He Framed in a Plot to Oust a Political Moderate?

"Come, Watson, come! The brew is afoot."

The Veterans Affairs Secretary's Apparently Scandalous Travel

On February 14, 2018, the Washington Post reported that the Department of Veterans Affairs (VA) Inspector General (IG) severely faulted travel arrangments made for a trip to Europe by the Department's Secretary, Dr David Shulkin.

Veterans Affairs Secretary David J. Shulkin’s chief of staff doctored an email and made false statements to create a pretext for taxpayers to cover expenses for the secretary’s wife on a 10-day trip to Europe last summer, the agency’s inspector general [IG] has found.

Vivieca Wright Simpson, VA’s third-most-senior official, altered language in an email from an aide coordinating the trip to make it appear that Shulkin was receiving an award from the Danish government, then used the award to justify paying for his wife’s travel, Inspector General Michael J. Missal said in a report released Wednesday. VA paid more than $4,300 for her airfare.

At first impression this seemed like just another travel scandal for the administration, which seemed to have made a practice of appointing top agency leaders who felt entitled to high-end travel options.  The Post article noted,

Shulkin is one of five current and former Trump administration Cabinet members under investigation by agency inspectors general over travel expenses, an issue that forced Tom Price to resign as health and human services secretary in the fall. Shulkin and other Cabinet officials have said their travel, often on private and military planes or to speak at political events, was approved by agency ethics officials.

One Republican Congressman immediately called for Dr Shulkin to resign because of "corruption," according to the Atlanta Journal Constitution.

As of February 16, 2018, VA Chief of Staff Viveca Wright Simpson did resign, according to CNN.

A Murky Brew

"the foam thickens"

On closer reading, however the details of the current case were at least somewhat murky.

The IG charged that the VA Chief of Staff, Viveca Wright Simpson, had altered an email to make it appear that Dr Shulkin would receive some sort of award at the US Embassy in Copenhagen, which would have apparently justified paying for Shulkin's wife's travel.  Yet, "In an interview with investigators, Wright Simpson said she did not recall whether she altered the email, Missal wrote."

The Secretary and his wife received tickets for events at the Wimbledon tennis tournament.  Dr Shulkin stated that the person who gave them the tickets was a friend of his wife, but the IG noted that when called, the person who gave them the tickets could not recall his wife's first name.  However, later that person provided a statement saying

The investigators unexpectedly called me on my mobile phone whilst I was driving on a very busy highway,


I felt like the investigators were twisting my words and trying to put words into my mouth.

The IG concluded that the awarding of tickets was improper, Ms. Gosling gave a gift of the Wimbledon tickets, valued at thousands of dollars on the secondary commercial market, because of Secretary Shulkin’s official position.” However, "Shulkin’s attorneys said the secretary was not prohibited from accepting the tickets, because Gosling neither does nor seeks to do business with VA."

The IG also contended that a VA staffer was excessively helpful in making travel arrangements for Dr Shulkin's wife, and that some travel expenses were poorly documented.


In his formal response to Missal, Shulkin wrote that VA staffers suggested his wife’s travel be paid for by the agency. He called the inspector general’s portrayal of the trip 'entirely inaccurate' and said it 'reeks of an agenda.'

'It is outrageous that you would portray my wife and me as attempting to take advantage of the government,' he wrote.

Of course, a high government official in trouble for this sort of thing might make that sort of response.

But wait, there is more, including substantial evidence about that "agenda."

A Political Plot?

Political Appointees Scheme to Oust Dr Shulkin

One day later, a New York Times story suggested it was all a lot more complicated.  The background is that

Dr. Shulkin was an unexpected but popular choice for secretary. After the 2016 election, Mr. Trump considered several critics of the department as possible nominees to head the agency. But to the relief of most veterans’ organizations, he chose Dr. Shulkin, a moderate who headed the agency’s health care system under President Barack Obama.

Dr Shulkin also is a fan of having the VA continue to directly provide care to most of its veteran clients/ patients. Note that,

The department currently operates its own health system, with more than 1,200 hospitals and clinics across the country where about nine million veterans receive treatment at little or no cost to them.


Some conservatives, including some advisers to the White House, [who] favor gradually dismantling that system and allowing veterans to choose to receive taxpayer-subsidized care from private doctors instead.

Veterans’ groups have overwhelmingly opposed that idea. But Mr. Trump promised during his election campaign that 'vets will have the right to go to a V.A. facility or the right to see a private doctor or clinic of their choice — whatever is fastest or best for the vet.'
Note that those who favor privatizing or out-sourcing VA health care functions have apparently provided no evidence from clinical or health services research that doing so would provide benefits to veterans that outweigh their harms.  Nonetheless, it appears that some VA officials who were political appointees of the Trump administration did not think Dr Shulkin was doing enough to privatize VA sevices.

In December, according to congressional staff members, political appointees in the department quietly bypassed the secretary to advance legislation that would open the way for more privately provided health care for veterans. The bill was introduced by Senator Jerry Moran, Republican of Kansas, who has received substantial campaign donations from the Koch brothers.

Meanwhile, the NYT reported that a campaign began to remove Dr Shulkin.

An email sent in December by Jake Leinenkugel, the White House senior adviser on veterans affairs, expressed frustration with Dr. Shulkin and listed ways to topple the leadership of his department once key legislation was passed.

The email was addressed to Camilo Sandoval, a former data manager for the Trump campaign who was given a political post at the department. In it, Mr. Leinenkugel, a former brewery executive, wrote that although he initially had a positive impression of the secretary, they had fallen out over staffing and policy issues.

The tactics proposed for this sort of an in-house coup were:

Mr. Leinenkugel, who has an office in the department, proposed 'solutions' in the email, including using a continuing investigation of the secretary’s travel to remove Dr. Shulkin’s chief of staff, Vivieca Wright Simpson; replacing the deputy secretary, Thomas G. Bowman, with Mr. Leinenkugel; and replacing Dr. Shulkin with a 'strong political candidate.'

Re that "strong political candidate":

Mr. Leinenkugel’s suggested replacement for Dr. Shulkin would be likely to spark controversy: Michael J. Kussman, a former under secretary who has been associated with Concerned Veterans of America, a group funded largely by the billionaire conservative activists Charles G. Koch and David H. Koch that advocates shifting spending on veterans’ health care to the private sector.

Note that Mr Leinenkugel apparently has no training, experience, or expertise in medicine, health care, or public health.  Rather he is a former executive of a family owned brewery that had been sold off to MillerCoors (look here).  Mr Leinenkugel did serve as a Marine for six years, but in the Phillipines, and Korea, apparently not seeing combat (look hereand here).  As the executive and presumably part owner of a substantial brewery, it seems doubtful that he ever had to personally seek care at a VA facility.

Furthermore, Mr Leinenkugel was working with Camilo Sandoval, a former data operations manager for the Trump campaign, with no known health care or public health background, or military experience (look here).

Dr Shulkin Fights Back and the Influence of More Political Operatives Revealed

Dr Shulkin suggested that the alleged plotter might not have been acting to promote the best interests of veterans, saying
he was investigating a number of political appointees in his department for misconduct and possible removal. On Thursday, he spoke directly to the White House chief of staff, John F. Kelly, about concerns that political appointees were trying to undermine his agency, according to department officials.

'If there are people here who don’t want the V.A. to succeed, I want them out,' Dr. Shulkin said in the interview.

Whether Dr Shulkin will prevail is a big question.Turmoil at the department seems to be growing.  Last week the Washington Post quoted unnamed White House officials who said Mr. Bowman, the deputy secretary, would soon be fired as a “warning shot” to “knock Shulkin down a peg or two” for not pushing harder for privatization.

Also, per the NY Times,

In another sign of division, John Ullyot, a former top Trump campaign official who now runs the press office, told staff members in an email on Wednesday that reporters’ requests for comment should not be forwarded to the secretary or deputy secretary; instead, he would be referring them all to the White House.

The move forced Dr. Shulkin to do much of his communication with the media over the travel investigation on his personal cellphone.

Then, per CNN on February 16, Viveca Wright Simpson, VA Chief of Staff, had resigned, and in response Dr Shulkin stated,

'This was a personal decision,' Shulkin said, adding that Wright Simpson called him on Friday morning to inform him. 'She just didn't feel that it was the right thing for her and her family to continue in that type of environment.'

Furthermore, her replacement, Peter O'Rourke, appears to be something of a political appointee,

the VA announced that Peter O'Rourke would replace Wright Simpson as chief of staff, effective immediately. O'Rourke currently serves as executive director for VA's Office of Accountability and Whistleblower Protection. O'Rourke's job will be 'ensuring that the department works closely with the White House going forward,' according to a statement from VA Press Secretary Curt Cashour.

O'Rourke is a Navy and Air Force veteran and previously worked for Trump's presidential campaign, according to his LinkedIn profile.

Furthermore,also on Feb 16, Pro Publica in conjunction with Politico published a long article on the background to the political dispute about privatizing or out-sourcing VA clinical functions.  It turns out that this is been going on for a while, and that the privatization/ out-sourcing agenda is mainly being pushed by the Concerned Veterans for America (CVA), a group backed by the Koch brothers.

The Pro Publica article provided more information about the roster of de facto political commissars attached by White House operatives to the VA.  One was Darin Selnick, a retired Air Force Captain, who had a career as a business consultant, and led "faith-based" initiatives at the VA under President George Bush, according to his LinkedIn profile. I can find no evidence he has any training,  experience or expertise in health care or health policy.

Trump picked Darin Selnick for the 'landing team'that would supervise the transition at the VA. Selnick had directed CVA’s policy task force, which in 2015 recommended splitting the VA’s payer and provider functions and spinning off the latter into a government nonprofit corporation.


He joined the VA as a 'senior advisor to the secretary.' Though he reported to Shulkin, he quickly began developing his own policy proposals and conducted his own dealings with lawmakers, according to people with knowledge of the situation. In mid-2017 Shulkin pushed him out — sort of.

Selnick left the VA offices and took up roost in the White House’s Domestic Policy Council. There he started hosting VA-related policy meetings without informing Shulkin, according to people briefed on the meetings.

Another was Dr Shulkin's own press secretary, Curt Cashour.  According to his LinkedIn profile, he previously worked for Republican Scott Walker's campaign for governor of Wisconsin, is not a veteran, and has no health care or health policy training, experience or expertise. Cashour also was a former staffer of Representative Jeff Miller:

Jeff Miller, then the chairman of the House veterans committee. Miller, who retired from Congress in January 2017, was a close ally of CVA and a scathing critic of Obama’s VA.

Miller became one of the first congressmen to endorse Trump, in April 2016. He did so a few weeks after attending a meeting of the campaign’s national security advisers. (That meeting, and the photo Trump tweeted of it, would become famous because of the presence of George Papadopoulos, who is cooperating with investigators after pleading guilty to lying about Russian contacts. Miller is wearing the light gray jacket in the front right. Now a lobbyist with the law firm McDermott Will & Emery, he didn’t reply to requests for comment.)

At one time, Dr Shulkin directed Cashour to

update its motto, to be inclusive of servicewomen. (Adapted from Abraham Lincoln’s second inaugural address, the original reads, 'To care for him who shall have borne the battle and for his widow, and his orphan.' The new version would read: 'To care for those who shall have borne the battle and their families and survivors.')

Cashour told The Washington Post the motto wouldn’t change. A few days later, the secretary’s strategic plan went out using the updated, gender-neutral motto. Cashour then denied the change a second time, telling the Post that was 'not VA’s position.' A new document with the Lincoln quote restored subsequently appeared on the VA’s website. Shulkin was stunned at being disobeyed by his own spokesman, two people briefed on the incident said. (Cashour denied defying the VA secretary. “The premise of your inquiry is false,” he told ProPublica. Cashour said Shulkin never approved the letter regarding the updated motto and authorized the restoration of the original one.)

So, to summarize, Dr Shulkin, a previous appointee of President Obama, who was appointed to head the Department of Veterans Affairs by President Trump, with the unanimous approval of the Senate, was under seige because he did not support proposals to privatize or out-source many of the VA's clinical functions.   The main functions of the VA involve providing health care to Veterans.   Out-sourcing/ privatization was mainly supported by a Koch backed organization, the CVA, apparently for ideological reasons, but not apparently based on evidence that it would provide benefits to veterans that would outweigh its harms.  Much of the seige work was accomplished by Trump administration political appointees, none of whom had training, experience or expertise in health care or health policy. 

Summary and Discussion

Dr David Shulkin, a holdover appointee of President Obama who was nominated to be Secretary of Veterans Affairs by President Trump, was alleged by the VA Inspector General to have committed various ethical violations involving a trip to Europe the Secretary took with his wife.  This appeared to be just the latest in a string of travel-related scandals by top officials of the Trump administration.

When this was first reported, I was inclined to see Dr Shulkin as an entitled, and conflicted  former health care executive who ran afoul of the government's strict ethical standards.  (Dr Shulkin's official VA biography lists his previous positions, including "chief executive roles at Morristown Medical Center, and the Atlantic Health System Accountable Care Organization. He also served as President and CEO of Beth Israel Medical Center in New York City." His 2016 federal financial disclosure, according to Open Secrets, listed assets of $9,342,201 to $24,966,000.  Also, he had served on advisory boards and boards of directors of numerous commercial health care firms, and held stock options from some of these positions.)

Note that the NY Times editorial page just supported that position, lumping his case with that of other Trump cabinet members with "dubious ethics."

But on review, his travel improprieties did not seem as serious as those of some other administration figures (for example, now ex-Secretary of Health and Human Services Dr  Tom Price, had flown multiple times on private aircraft costing the government hundreds of thousands of dollars, per Politico.)

Furthermore, subsequent reports raise doubts about whether Dr Shulkin committed any improprieties, and suggested rather that he was targeted for removal because he was insufficiently "political," presumably meaning insufficiently beholden to President Trump, and unenthsiastic about dismantling the VA health system and handing its work over to the commercialized health care private sector.  Furthermore, considerable opposition to Dr Shulkin came from within his own department, apparently organized by political appointees devoted to Trump, and an ideological agenda of privatization and out-sourcing, who seemed to be acting like old-style Stalinist political commissars.

Note that USA Today just reported that three big veterans' groups weighed in with their support for Dr Shulkin, suggesting that his travel misdeeds were minor, and his efforts to improve care for veterans major.

But what really happens remains something of a mystery.  Perhaps a modern day Sherlock Holmes would help?

In any case, the events do not reflect well on the Trump regime management of the Department of Veterans Affairs.  Either it placed an entitled, and possibly previously conflicted physician in charge, who was then cavalier about government ethics rules; or worse, it put in charge a perhaps politically clumsy physician who was nonetheless dedicated to the welfare of veterans, but then undermined him when he proved to be insufficiently politically loyal, and perhaps not interested enough in promoting private commercial health care interests ahead of veterans' care. 

Nothing in this story suggests that the Trump regime really cares that much about veterans, other than as means to political ends and to economic benefits to corporate cronies.  Note that privatizing VA clinical functions would provide a huge new patient population to private, including for-profit hospital systems, many of which may not be equipped to deal with the needs of veterans who need rehabilitation for complex and severe injuries, or suffering from the extreme psychological effects of the battlefield.  Privatizing would also presumably provide a physician pool suddenly free from tight VA restrictions on conflicts of interest, who would suddenly become vulnerable to drug, device, biotechnology and other companies bearing money.

Speaking of true health care reform in the time of Trump seems almost silly, but true health care reform requires putting patients' and the public's health ahead of private greed and lust for political power.


APeticola said...

Thanks, Roy. This is very upsetting. Shulkin was one of the rare qualified Trump appointees. Hoped that meant the VA wasn't screwed. But I guess they are working hard to do that. Very very worried.

IRBChair said...

Thank you for uncovering and providing us with this interesting but disturbing information, Roy. Long ago--back in the mid- to late-1980s--I had brief but memorable professional dealings with Dr. Shulkin which for me cast considerable doubt on his integrity. Moreover, I have several colleagues who had more extensive experience with him but, while acknowledging his intelligence and political savvy as a healthcare executive, found him autocratic and devious. When Shulkin was nominated for the Secretary of the Department of Veterans Affairs position, I nearly wrote letters to Jon Tester, the ranking minority member of the Senate Veterans Affairs Committee, and the other minority members of the committee, to inform them of the details of my own negative experience with the nominee, which incidentally involved the VA. However, I had more recently observed that in his role in the Obama administration as Undersecretary of Veterans Affairs for Health, he seemed to be less than enthusiastic about privatizing VA care. Furthermore, there were other signs that Shulkin would promote some rather progressive and innovative programs for caring for veterans, particularly offering more support for those with psychiatric problems, including those who were not honorably discharged. For those reasons, I backed off making any disclosures about Shulkin and have since regarded him as the "best of the worst" within the destructive and dangerous Trump administration. Your revelations confirm that assessment: Shulkin may not be the most honorable of human beings, and he certainly isn't as shrewd in the larger national political arena as he was in the world of medical center governance, but he may well be an effective Secretary for DVA who is worthy of support against attempts to oust him from that position on the basis of some of his better qualities.

Cetona said...

I've known Dr. Shulkin for a long time. In this administration he is indeed one of those rare instances of an appointee with altruism and expertise. But now he's run afoul of the autocannibalistic tendencies of a bizarre group of insiders and hacks. The whole Drumpf administration is beset with this internal dynamic. It's a dynamic in which infighting and undermining behavior is so rampant we really can't stop by calling it corrupt. It's dysfunctional taken to new heights. The dysfunctional flows right back up to the chief, who thinks he's a producer giving notes on The Apprentice.