A leading House Republican wants a criminal prosecution referral for Oregon state officials, alleging they illegally coordinated with a former Oregon governor’s campaign advisers on the state’s Obamacare exchange and misused $300 million in federal taxpayer dollars.
House Committee on Oversight and Government Reform (HOGR) Chairman and Utah Republican Rep. Jason Chaffetz made the request in letters to U.S. Attorney Loretta Lynch and Oregon Attorney General Ellen Rosenblum on Wednesday. Chaffetz cited a new 200-page HOGR report made public Wednesday drawing from more than 170,000 pages of documents about the state’s failed exchange, Cover Oregon.
The report claims former Oregon Gov. John Kitzhaber’s official staff and campaign operatives intervened in an independent state Obamacare board’s decisions, using campaign funds and personal email accounts and other “back channels” to influence a move from the state-run website to HealthCare.gov, and by extension, influence the governor’s 2014 reelection odds.
HOGR also faults the Centers for Medicare and Medicaid Services for allowing the collapse of Cover Oregon, and failing to conduct proper oversight of federal funds. (RELATED: Oregon To Drop Its Disastrous Obamacare Exchange)
“The state exchange never came to fruition, and the money is gone,” Chaffetz wrote to Lynch. “Our investigation shows Oregon state officials misused federal funds, and improperly commingled official and political resources for the purpose of enriching the political prospects of then-Oregon state Gov. John Kitzhaber.”
Cover Oregon became famous for spending $8 million on a marketing campaign that produced a psychedelic ad to promote enrollment in 2013. But the Cover Oregon rollout in October 2013 was a disaster, much like the federal rollout of HealthCare.gov.
Kitzhaber resigned in February 2015 amid allegations that he and his fiancé used the governor’s office for personal gain and to promote environmental groups.
The committee says the documents and testimony unearthed in a year-long investigation reveal the governor’s official and campaign staff ignored official technology experts’ recommendations and steered the supposedly independent Cover Oregon Board of Directors to switch from the state-run website to HealthCare.gov. The report also claims the governor’s campaign spent its funds to support the governor in his official capacity in an attempt to improve the governor’s reelection chances.
“Documents and testimony show the involvement of Kitzhaber’s staff and campaign advisers was inconsistent with the intent of Oregon law and the Cover Oregon governance model,” the report said.
Documents also show the governor and his team “attempted to thwart record-keeping laws through the use of offline, secret back channels,” including personal email accounts, the report said.
Patricia McCaig, one of Kitzhaber’s top political operatives, told the governor she thought asking for extra money to restore the website would be politically risky. So, the day after an April 8, 2014, call between Kitzhaber’s campaign staff, official staff, and Cover Oregon officials, McCaig on April 9 sent Kitzhaber an email “outlining a plan to stage the decision to switch to HealthCare.gov,” according to the committee report.
The governor also told his staff in a May 2014 email he was frustrated by the “free independent expenditure campaign that the Cover Oregon issue is giving to Dennis Richardson,” his Republican opponent in the gubernatorial election.
McCaig sent Kitzhaber a list of options, including requesting the Attorney General to take legal action against Oracle, a Silicon Valley technology company contracting with Cover Oregon. The governor sent a letter to the Attorney General sent a letter requesting that shortly afterwards.
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