A congressional investigation prompted by ProPublica's reporting found Trump's "Mar-a-Lago crowd," wealthy civilians with no U.S. government or military experience.
This article was published on Monday, September 27, 2021 in ProPublica.
Former President Donald Trump empowered associates from his private club to pursue a plan for the VA to monetize patient data, according to documents newly released by congressional investigators.As ProPublica first reported in 2018, a trio based at Trump's Mar-a-Lago resort weighed in on policy and personnel decisions for the federal government's second-largest agency, despite lacking any experience in the U.S. government or military.
While previous reporting showed the trio had a hand in budgeting and contracting, their interest in turning patient data into a revenue stream was not previously known. The VA provides medical care to more than 9 million veterans at more than 1,000 facilities across the country.
"Patient data is, in my opinion, the most valuable assets [sic] the VA has," a consultant said in a June 2017 email released Monday by Democrats on the House Oversight Committee. "It can be leveraged into hundreds of millions in revenue" by selling access to major companies, he said.
The consultant, Terry Fadem, ran a private nonprofit for Bruce Moskowitz, a West Palm Beach, Florida, physician who was one of the three Trump associates given sweeping influence over the VA, known to officials as "the Mar-a-Lago crowd."
In response to Fadem's email, Moskowitz told then-VA Secretary David Shulkin that he had discussed the plan with interested companies including Johnson & Johnson, CVS and Apple. Shulkin replied that he liked the idea, according to the documents.
Senior officials scrambled to hire Fadem as a contractor, the emails show, but it's not clear whether his contract was awarded. "I am working on trying to understand why and where [h]is contract is stuck," Poonam Alaigh, then the agency's top health official, said in a June 2017 email. "I agree, having him on board as soon as possible will be critical."
The documents do not show what became of the plan or whether the VA ever sold access to patient data. Nor do the records include evidence that Moskowitz or the other Mar-a-Lago associates were in a position to profit personally.
A spokesman for the trio said as far as they know Fadem was not hired and the VA never acted on the licensing idea. "We were asked repeatedly by former Secretary Shulkin and his senior staff, as well as by the President, to assist the VA and that is what we sought to do, period," the three said in a statement.
Shulkin, Alaigh, Trump's office, the VA, Johnson & Johnson, CVS and Apple did not immediately respond to requests for comment. Fadem died in 2019.
The latest revelation helps complete the picture of the Mar-a-Lago triumvirate's extensive influence over Trump's agenda for veterans, a signature issue in his 2016 campaign. ProPublica's revelations about the men's day-to-day involvement prompted investigations by congressional committees and the Government Accountability Office, as well as a court challenge.
House Oversight Committee chairwoman Carolyn Maloney, D-N.Y., and House Veterans Affairs Committee chairman Mark Takano, D-Calif., said in a statement on Monday that the documents show "the secret role the trio played in developing VA initiatives and programs, including a 'hugely profitable' plan to monetize veterans' medical records."
"Ike Perlmutter, Marc Sherman, and Dr. Bruce Moskowitz, bolstered by their connection to President Trump's private Mar-a-Lago club, violated the law and sought to exert improper influence over government officials to further their own personal interests," the chairs said.
Perlmutter, Sherman and Moskowitz have previously said that they obtained no personal benefits, had no official role and exercised no formal authority.
But the newly released documents show that they did view themselves as an official advisory committee — and disregarded repeated warnings that they needed to comply with a Watergate-era transparency law.
"As the President asked, we can now formally create an official committee," Perlmutter, the group's leader and chairman of Marvel Entertainment, wrote in a February 2017 email after a meeting with Trump. Perlmutter is a Mar-a-Lago member and one of Trump's biggest political donors.
Perlmutter went so far as to rebuke White House staff for holding discussions without him.
"I am shocked and extremely disappointed with the manner in which you have engaged in individual communications with Apple — and intentionally excluded our broader team of subject matter experts," Perlmutter said in a March 2017 email to White House aides. "I understand that these backdoor discussions have apparently been occurring almost daily for weeks, and you have not told anyone and refuse to return phone calls and emails."
Official advisory committees are governed by the Federal Advisory Committee Act. The 1972 law, known as FACA, requires federal agencies to inform the public when they consult outside experts.
Administration officials repeatedly told the Mar-a-Lago trio that they would have to comply with the law. The law compels advisory committees to represent a range of views and disclose their activities to the public.
"It appears FACA may be implicated," a VA lawyer said in a January 2017 email that Shulkin shared with Moskowitz.
That April, White House aide Reed Cordish told Perlmutter directly, "You will need to form a FACA group."
But Perlmutter demurred, replying, "We have been advised that FACA does not apply because we are not a formal group in any way."
Instead, the group took efforts to conceal its activities, documents show. "We are still unsure what can be put in emails and what to discuss verbally," Moskowitz wrote to Shulkin in February 2017.
The group's spokesman maintained they weren't a formal committee and said complying with FACA was the agency's responsibility.
In March 2021, a federal appeals court in Washington held that a liberal veterans group could proceed with a lawsuit to enforce FACA's disclosure requirements around the Mar-a-Lago trio.
“Patient data is, in my opinion, the most valuable assets [sic] the VA has. It can be leveraged into hundreds of millions in revenue.”
Terry Fadem, consultant, June 2017
ProPublica is an independent, non-profit newsroom that produces investigative journalism in the public interest.
Photo credit: Fort Wayne - Circa August 2018: Signage and logo of the U.S. Department of Veterans Affairs. The VA provides healthcare services to military veterans III By Jonathan Weiss / Shutterstock
The latest revelation helps complete the picture of the Mar-a-Lago triumvirate's extensive influence over Trump's agenda for veterans, a signature issue in his 2016 campaign.
ProPublica's revelations about the men's day-to-day involvement prompted investigations by congressional committees and the Government Accountability Office, as well as a court challenge.
House Democrats say the documents show "the secret role the trio played in developing VA initiatives and programs, including a 'hugely profitable' plan to monetize veterans' medical records."