About 12 senior staff members at the Centers for Medicare & Medicaid Services gave five Wall Street investors a private, two-hour hearing in 2009 during which the insiders asked about the reimbursement prospects for medical devices they’d backed or were considering, according to the Project on Government Oversight.
The meeting, brought to light after CMS staffer who attended filed an ethics complaint, is apparently a routine practice at the massive federal agency charged with administering the government health insurance programs.
"This meeting forced agency staff to redirect their attention toward a select group from Wall Street, when neither competing investors nor patient-oriented stakeholders were present," the anonymous whistleblower told POGO. "They got to probe us for hours in private about what we planned to do and how we approached procedures for reimbursing medical devices, the mechanics and psychology of CMS decision-making, in general and with respect to these specific devices."
In one case, The Street insiders asked about an already-approved device with a $1 billion market; at the time CMS was considering whether to reimburse for other companies’ competing devices, according to the POGO report. Some of the questions about internal workings at CMS, if answered, would have broken federal law, according to the whistleblower.
"After a thorough review, the Ethics Office determined that for the meeting in question, there was no misuse of government time and resources, and that the meeting was held consistent with agency rules on contacts between CMS staff and members of the public," an agency spokesman told the non-profit watchdog group.