Why it Matters

The Senate Finance Committee is meeting Sept. 24 to consider favorably reporting four nominations that would fill key positions at the Department of Health and Human Services (HHS), Internal Revenue Service (IRS) and U.S. Tax Court. The nominees are Gerard Klomp for deputy secretary of HHS, Ge Bai for assistant secretary of HHS, James Gadwood for IRS chief counsel and assistant general counsel of the Treasury, and Andrew A. De Mello for a 15-year term as a judge on the U.S. Tax Court. The business meeting is chaired by Sen. Mike Crapo (R-ID), with Sen. Ron Wyden (D-OR) serving as ranking member.

Broader Context

The committee held a confirmation hearing for all four nominees on Sept. 15. Each nomination carries its own political weight. Bai, nominated to serve as assistant secretary for planning and evaluation, has been a vocal critic of the 340B Drug Pricing Program, a federal program that requires participating drug manufacturers to provide discounts to certain safety-net hospitals and clinics. Bai has argued that the program has strayed from its original purpose, describing it as a "buy-low, sell-high program." Her nomination could draw continued scrutiny from lawmakers representing hospitals and clinics that participate in the program.

On Sept. 14, Sen. Elizabeth Warren (D-MA) sent a letter pressing Gadwood on ethics commitments, arguing that conflicts stemming from his prior private-sector legal work could "cloud your judgment or raise questions about the integrity of official decisions in which you are involved." Warren cited Gadwood's work at Miller & Chevalier, which represents large corporate clients, and his disclosure that DJT Holdings LLC, an entity linked to President Donald Trump, had been a source of more than $5,000 in compensation for legal services.

De Mello's path to a Tax Court nomination has also drawn scrutiny over his previous role as acting IRS chief counsel. During his tenure, the Justice Department reached a May settlement in Trump v. IRS, a lawsuit brought by Trump, his sons and the Trump Organization over the disclosure of their tax information by former IRS contractor Charles Littlejohn. The settlement created a $1.776 billion Anti-Weaponization Fund, while the plaintiffs received a formal apology but no monetary damages. A separate release issued in connection with the settlement drew criticism over provisions concerning future IRS actions involving Trump, his family and related entities.

De Mello also drew attention during his tenure as acting chief counsel after CBS News reported that he had been supportive of Elon Musk's Department of Government Efficiency and received a Treasury Department request to examine whether Harvard University's tax-exempt status could be revoked.

The IRS Chief Counsel's Office has experienced substantial turnover during the Trump administration. Marjorie Rollinson, the last Senate-confirmed chief counsel, left at the beginning of the administration. William Paul and De Mello subsequently served in acting roles, and Kenneth Kies has also served as acting chief counsel. Trump nominated former IRS Chief Counsel Donald Korb to return to the position but later withdrew the nomination before nominating Gadwood.

The Bottom Line

The HHS deputy secretary position that Klomp is nominated to fill has been vacant since James O'Neill resigned Feb. 13. Bai, meanwhile, has been serving in an acting capacity as assistant secretary for planning and evaluation.

The Sept. 24 executive session represents the next step toward filling positions across agencies responsible for federal health policy, tax administration and the tax judiciary. The records of Bai and De Mello have drawn scrutiny from senators, while Warren's written exchange with Gadwood over ethics commitments could remain an issue if the nominations advance to the Senate floor.

Access the Legis1 platform for comprehensive political news, data, and insights.

Spot something wrong? Report an issue with this article