Healthcare Business News
Sen. Chuck Grassley

GOP lawmakers decry use of HHS funds for 'propaganda'

By Rich Daly
Posted: September 30, 2012 - 12:01 am ET

Congressional Republicans, irate that federal exchange funding has gone to “insert propaganda into the popular culture,” have demanded details on the grants and the extent of their oversight by HHS.

Sen. Chuck Grassley (R-Iowa), ranking member of the Judiciary Committee, and Rep. Fred Upton (R-Mich.), chairman of the Energy and Commerce Committee, wrote HHS Secretary Kathleen Sebeliuson Friday for details about how the states have used about $2.2 billion in various types of exchange funding that the department has issued so far. The funds were intended to help states launch insurance marketplaces by 2014, although most states are expected to have their exchanges operated by the federal government—at least initially.

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The Republicans' ire was drawn by published reports that the California exchange, which the HHS exchange site lists as having received almost $236 million in federal support, spent nearly $1 million on a contract at least partly aimed at inserting positive references to the federal healthcare law into network television entertainment programs.

“Americans' hard-earned money should not be taken by government to subsidize Hollywood and insert propaganda into the popular culture,” the members of Congress wrote. “It should be going toward ensuring that the cost of healthcare is being lowered for all Americans.”

The department was reviewing the letter Friday and did not have any comments, an official said.

Also, HHS confirmed that four states have officially returned some category of exchange funding: Oklahoma, Kansas, Louisiana and Maine. Also, Wisconsin is in the process of returning its early innovator grant.

The exchanges have drawn increasing attention from Republican elected officials as a Nov. 16 deadline approaches for states to submit operational plans or face a federal takeover of the insurance marketplaces. For instance, Sen. Orrin Hatch (R-Utah), ranking member of the Finance Committee, wrote Sebelius on Sept. 24 for more details on the federal version of the exchanges, for which regulations have yet to be issued.

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