Concerns over violations of federal ethics laws, after Kushner took charge of coronavirus

Trump’s son-in-law sets up shop at FEMA as his portfolio balloons to include manufacturing, supplies and long-term planning.

By ADAM CANCRYN and DAN DIAMOND

Dozens of Trump administration officials have trooped to the White House podium over the last two months to brief the public on their effort to combat coronavirus, but one person who hasn’t — Jared Kushner — has emerged as perhaps the most pivotal figure in the national fight against the fast-growing pandemic. 

What started two-and-a-half weeks ago as an effort to utilize the private sector to fix early testing failures has become an all-encompassing portfolio for Kushner, who, alongside a kitchen cabinet of outside experts including his former roommate and a suite of McKinsey consultants, has taken charge of themost important challenges facing the federal government: Expanding test access, ramping up industry production of needed medical supplies, and figuring out how to get those supplies to key locations.

Kushner has even obtained a new center of power at the Federal Emergency Management Agency, the crisis-response organization that’s taken over coronavirus strategy and planning — and where Kushner and his deputies ride herd on the health agencies that had been criticized for their slow responses to the pandemic earlier this year.

Kushner’s group, which some have characterized as an “all-of-private-sector” operation in contrast to Vice President Mike Pence’s “all-of-government” task force, has had its successes – including airlifting emergency medical supplies to the United States, crowdsourcing mask and glove donations, and rapidly devising a last-ditch plan for hospitals to maximize ventilators.

But the behind-the-scenes working group has also duplicated existing federal teams and operations, and its focus on rapid, short-term decisions has created concern among some health-agency officials, according to interviews with 11 people involved in Kushner’s effort, including senior government officials, outside advisers and volunteers on the projects, as well as other health department and White House officials.

Federal decision-making is complicated by the fact that Kushner has the full confidence of President Donald Trump, with whom he confers multiple times a day, while Trump has expressed frustration with some of the leaders of health agencies.

“You can’t have enough good smart people working on a problem of this scale,” said Andy Slavitt, who helped lead the Obama administration’s 2013-2014 HealthCare.gov repair effort and is now advising on Kushner’s coronavirus response. “But they have to be organized with a clear chain of command.”

The crisis response team built by the president’s son-in-law is distinct from the White House task force led by Pence, and has adopted an all-out, ad-hoc attitude toward beating back the coronavirus pandemic, heedless of normal government boundaries and, to some extent, conflicts of interest.

“It’s a little crazy,” said one of the outside advisers brought in to aid government officials on the effort. “It’s all hands on deck — it’s literally, who’s got the technology and data? Who can help us?”

Kushner has relied on select officials, including his one-time former roommate and current U.S. foreign investment czar Adam Boehler, and Brad Smith, the head of Medicare’s innovation center, to organize and manage key projects — bypassing the bureaucratic structures and internal rivalries that slowed progress in the response’s early months.

A group of outside experts is also pitching in daily, working alongside government officials from FEMA, HHS and USAID to solve a range of logistical and technical challenges, often by tapping into their own extensive networks. That faction includes Flatiron Health’s Nat Turner, private equity executive Dave Caluori, and other private sector contacts who volunteered to aid the effort.

Yet the co-mingling of administration aides and private-sector executives has led to new quandaries, according to health officials and even some of the outside advisers working with Kushner. Projects are so decentralized that one team often has little idea what others are doing — outside of that they all report up to Kushner. People around Kushner are fielding all manner of outside pitches, making it difficult for the group to stay focused.

And there is limited vetting of private companies’ and executives’ financial interests, raising questions about the motivations and potential conflicts inherent in an operation that relies on an ill-defined and ever-expanding group of outside contributors. 

“There have been two rules: People signed voluntary service agreements that were vetted by career legal professionals — and that there is no one doing procurement, outside of government officials,” said one senior administration official directly involved in the effort.

Nonetheless, the watchdog group Citizens for Responsibility and Ethics in Washington, which has already warned that Kushner’s operation could violate federal recordkeeping laws, blasted the White House for its extensive reliance on the private sector and lack of transparency.

“They’re not necessarily doing something nefarious, but if they were, this is what they would do to hide it,” CREW spokesperson Jordan Libowitz said.

Kushner’s effort to find work-arounds to government bureaucracy, officialssaid, was initially spurred by Trump’s frustration with health officials over the slow pace of testing. It has since expanded into nearly every major problem area facing the administration – a power shift that’s coincided with Trump’s realization of the gravity of the situation after two months where he’d often played it down or mismanaged the coronavirus threat.

Kushner and Pence’s teams also have taken pains to closely coordinate, several officials said, and a White House spokesperson said that Pence remains in charge of the administration’s coronavirus response. 

Officials working on the effort insist they are taking ethical precautions.

But the effort’s makeshift nature has unnerved even some recruited to aid Kushner’s team, who described it as a process unlike any other traditional disaster response. Kushner’s team has stepped in to coordinate decision-making at agencies including the Food and Drug Administration and the Centers for Medicare and Medicaid Services, and the scope of his authority now exceeds that of Health Secretary Alex Azar, the one-time leader of Trump’s coronavirus response.

“I don’t know how our government operates anymore,” said one Republican close to the administration, lamenting that the sudden authority granted to non-governmental actors had left them with their “eyebrow raised unbelievably high.”

The White House did not respond to questions about Kushner’s work or how it’s vetting private-sector partners, but said that the White House and HHS are “working hand-in-hand” to combat the virus — a message echoed by an HHS spokesperson, who said “we’re all working together.” Attempts to reach Kushner were unsuccessful. 

But defenders within the administration say Kushner has stabilized what they acknowledge had been a faltering response. For example, the Kushner team quickly assembled experts from around the nation to develop the health department’s new guidance on ventilators that was issued on Tuesday, which allows desperate hospitals to split ventilators in a bid to protect patients amid shortages.

Kushner’s team is helping speed crucial supplies like ventilators and masks to the front lines, while working to support the “Project N95” clearinghouse for personal protective equipment and ventilators. The team also set up the “Project Airbridge” supply-flights that are rapidly bringing tens of millions of medical supplies from overseas into the United States, rather than waiting for them to be shipped by sea. 

“Jared is definitely plugging gaps. No question about it,” a senior administration official said. “He’s been a voice of reason in pulling all the disparate work streams together.”

In recent weeks, Kushner’s team enlisted a series of health tech companies to work toward a new goal: Creating technology that can give the White House a real-time accounting of hospital bed capacity and medical equipment availability nationwide. 

Kushner was initially tapped to join the coronavirus response by Trump on March 12, when he moved quickly to address the testing shortfalls and pulled in allies with a track record of launching health care companies. The effort has been co-led by Boehler, an old friend of Kushner’s who started three companies and led Medicare’s innovation center before Trump picked him to run the U.S. International Development Finance Corporation last year. Another key player is Smith, the current head of the Medicare innovation center and co-founder of Aspire Health, who’s managing key swaths of the response.

The out-of-government team now includes Turner, an entrepreneur and investor who co-founded New York City-based Flatiron Health, as well as Caluori, a partner at private equity firm Welsh Carson Anderson & Stowe, who is voluntarily aiding the effort with the help of a couple other Welsh Carson associates, a person familiar with the team dynamics said. 

Slavitt, meanwhile, has provided guidance from the outside and connected Kushner’s group with private-sector teams and technologists to help spin up projects. Slavitt, who served as President Barack Obama’s acting Medicare chief and also has a history of launching health care startups, has been a noted critic of Trump’s health policies but has offered up his support to the White House.

The team has since helped roll out dozens of local testing sites, an achievement that falls well short of the president’s initial promise to set up a nationwide network of drive-through test centers and that Google would help manage the process through a website. Trump has faced criticism for overselling the initiative, one of several high-profile pledges on testing that’s fallen short.

“We stood up a full business in days,” countered a senior official. “The goal on the retail side was get them in and get them prototyped.”

Yet Kushner’s role in that episode has come under increasing scrutiny, most recently following an Atlantic report that Oscar Health – a health insurer co-founded by Kushner’s brother, Josh – was asked to develop the website that would direct people to the testing sites. Kushner himself also once partially owned or controlled the company. The project, which could have violated federal ethics laws, was ultimately scrapped, and an Oscar spokesperson said the company donated the work for free.

Kushner’s defenders say that his methods achieved what the health agencies working alone did not – gin up the private sector. Options like Abbott’s rapid point-of-care testing are coming online, and retailers like CVS and Walgreens are set to offer more testing soon, officials said.

CVS was cagier about its next steps, with a spokesperson acknowledging the “potential” to open additional testing sites. Walgreens did not immediatelyrespond to request for comment.

Kushner’s defenders also note that in the three weeks since Trump tapped Kushner to get involved, the U.S. response has surged from a few thousand coronavirus tests per day to more than 100,000 tests per day. The White House has been especially worried about the public perception of coronavirus testing after weeks of testing-access failures that are still ongoing, said four individuals with knowledge of White House strategy.

Other projects have not gone smoothly. Kushner’s team was involved in difficult negotiations with General Motors and ventilator company Ventec over expediting ventilator production, and when the deal initially fell through, Trump lashed out at GM on Twitter. Other corporate executives were dissuaded from participating in the coronavirus response after seeing Trump’s angry reaction, The New York Times reported.

POLITICO