President-elect Donald Trump’s nominee to lead the Department of Health and Human Services bought shares in a medical device company last year and then introduced legislation in the House to help the company less than a week later, CBS News has confirmed.
The new revelations about Rep. Tom Price, first reported by CNN on Monday evening, raises new ethics concerns and questions about whether Price engaged in insider trading. This comes just days before he’s slated to testify at his Senate confirmation hearing on Wednesday.
According to House records, Price, R-Georgia, bought between $1,000 to $15,000 worth of shares in the company Zimmer Biomet last March.
Days later, he introduced a bill that would have delayed a regulation until 2018 that industry analysts said would financially hurt Zimmer Biomet. Records show that after the introduction of the measure, the company’s political action committee donated to Price’s reelection campaign.
In a statement Tuesday, Zimmer Biomet’s vice president for corporate communications, Monica Kendrick, said that the firm didn’t know about Price’s purchase of stock in the company and said it wasn’t involved in the introduction of his bill to delay the regulation.
“Zimmer Biomet had no knowledge of Congressman Price’s purchase of Zimmer Biomet stock. As is common practice, the Zimmer Biomet PAC regularly makes donations to various political campaigns, all of which are disclosed as required by law,” she said. “These actions are not connected. Zimmer Biomet has supported the Comprehensive Joint Replacement (CJR) program developed and implemented by the Centers for Medicare and Medicaid Services. Zimmer Biomet was not involved in the Healthy Inpatient Procedures (HIP) Act, which was introduced by Congressman Price to delay CJR implementation.”
Senate Minority Leader Chuck Schumer, D-New York, said in a statement Monday that the Office of Congressional Ethics must “conduct an immediate and thorough investigation into these potential violations of the STOCK Act before Rep. Price’s nomination moves forward.” The STOCK Act was designed to combat insider trading among members of Congress.
“This new report makes clear that this isn’t just a couple of questionable trades, but rather a clear and troubling pattern of Congressman Price trading stock and using his office to benefit the companies in which he is investing,” Schumer said. “The President-elect claims he wants to drain the swamp, but Congressman Price has spent his career filling it up.”
This comes after The Wall Street Journal reported in December that Price traded more than $300,000 in healthcare stocks over the last four years while advocating or sponsoring bills that could have affected the stocks of those companies.
|© REUTERS Rep. Tom Price|
Tom Price nomination: Trump pick accused of insider trading
President-elect Donald Trump's pick to lead the overhaul of the US healthcare system has been accused of using his political position for financial gain.
Georgia Congressman Tom Price purchased stock from a medical company days before introducing a bill that would have helped the company, CNN reports.
Democrats have called for an inquiry but the Trump transition team have called the accusation a "smear".
And an aide to Dr Price said he was not personally behind the stock purchase.
On Wednesday the Senate will hold a confirmation hearing for him in his new role.
If appointed, Dr Price, who worked as an orthopaedic surgeon for nearly 20 years, will lead the Department of Health and Human Services and will play a key role in the Republican effort to overturn President Barack Obama's signature healthcare legislation.
Repealing major provisions of the law, formally known as the Affordable Care Act, would cause 18 million Americans to lose health insurance in the first year, according to a report released on Tuesday by the nonpartisan Congressional Budget Office.
Republican Speaker of the House Paul Ryan attacked the report as "meaningless".
According to congressional records cited by CNN, Dr Price purchased up to $15,000 (£12,000) worth of stock in Zimmer Biomet in March 2016.
Less than a week later he introduced legislation that would have delayed the creation of a new regulation that would have affected the medical device manufacturer.
Two days after offering the bill, the medical company's political action committee donated $1,000 (£800) to the congressman's re-election campaign fund, campaign records show.
Senator Chuck Schumer, who leads the Democratic minority in the Senate, called for the Office of Congressional Ethics to investigate whether Dr Price had violated the 2012 Stock Act, a law designed to combat insider trading by US congressman.
"The president-elect claims he wants to drain the swamp, but Congressman Price has spent his career filling it up," Senator Schumer said in a statement.
He called it "a clear and troubling pattern of Congressman Price trading stock and using his office to benefit the companies in which he is investing".
Mr Schumer wants a temporary halt in the nomination process as the proposed investigation is conducted.
The Wall Street Journal reported last month that Dr Price had traded roughly $300,000 (£245,000) in shares over the past four years in health companies while at the same time working on legislation that would affect them.
But Trump transition spokesman Phil Blando hit back. He said: "Senate Democrats and their liberal media allies cannot abide by the notion that Dr. Tom Price is uniquely qualified... and will stop at nothing to smear his reputation."
Dr Price did not make the trades himself, he said, they were done by an independent broker without his prior knowledge.
Eight of Mr Trump's cabinet picks will face confirmation hearings in the senate this week.
Mr Trump will be sworn in as the 45th president on Friday, 20 January.