Send Money Now: HHS’ Sebelius’ Request for Funds to Support Obamacare Compared to Iran-Contra Scandal


Health and Human Services recently admitted that Secretary Kathleen Sebelius solicited private support for the implementation of Obamacare programs including Enroll America, a nonprofit group devoted to expanding access that a former Obama administration staffer runs. According to Politico and other sources, HHS says there’s no problem with her actions.

According to the report, Sebelius sought donations from healthcare companies for a group working to encourage more people to enroll in Obamacare programs. Several key leaders, primarily Republicans, say Sebelius is showing disregard for constitutional principles and may violate the Antideficiency Act — the prohibition against augmenting congressional appropriations, and executive branch ethics laws.

According to their claims, Sebelius may be violating the constitution by seeking funds from sources other than Congress to implement the law; federal agencies are dependent on Congress for funding, and it is up to Congress to make policy choices about whether or not to provide funds for a particular program and to fix that level of funding or set terms and conditions on its use.

Sebelius obviously defends her actions and claims she’s doing no wrong. Standing behind the Public Health Service Act, Sebelius is making the claim that she has the clear authority to “support and encourage others to support, not-for-profits that are working to provide health information or conducting other public health activities.”

Clearly she’s stretching the boundaries of her power and there are clear ethical decisions she’s decided to make. It’s unclear yet whether or not she’s broken any laws by her actions. It is being argued whether or not she violated federal appropriate laws.

According to Politico, Sen. Lamar Alexander says that Sebelius has violated the principle that Congress is the body empowered to establish funding levels for the government’s activities and that no administration can short-circuit that process by soliciting and directing donations for things it deems important.

According to news reports, “At least one official in the healthcare industry felt pressure to give money and other forms of support to Enroll America.”

Essentially, at its base, the argument here is that if Sebelius is requesting money for the program, it’s pretty clear that organizations giving money to such programs could also send funds her way to gain her personal favor for their own organizations.

Even if there is no impropriety on her part, nor any accusations of impropriety, other healthcare leaders feel that the requirement that their organizations support federal programs with private money is just one more expense that will ultimately get passed onto consumers in what amounts to an ad hoc tax.

“I think it is wrong,” said Tom Grossjung, CEO of veEDIS Clinical Systems, LLC.  “Obamacare is flawed legislation to start. Industry funding will only find its way back to the consumers through higher prices from the private industries. It could also lead to further abuse of exemptions for certain sectors of the market.”

The controversy has even been compared to the Iran-Contra scandal of the 1980s, in which officials within the Reagan administration tried to sell arms to Iran to procure the release of hostages and fund rebels in Nicaragua.

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