Jonathan Gruber Tries to Get an Extra $40,000 from Vermont With Another Overbilled Invoice


For critics of Obamacare, Jonathan Gruber is the gift that just keeps on giving.

Tucked away in an appendix to the Vermont State Auditor’s memo criticizing Gruber’s likely overbilling for research assistant hours is this bombshell:

Gruber submitted another overbilled invoice on December 30 to the State of Vermont for an additional $40,000 beyond the $80,000 he’s already received.

The only problem with this for the embattled Ivy League-educated MIT professor is that he agreed, in an amendment to his contract in November, that $80,000 was all he was entitled to receive for his personal consulting services under the revised terms of the contract.

As the amended contract clearly states:

“In Attachment B, Payment Provisions on page 7, of the base contract: update to reflect the total maximum of $280,000 with future invoices only for work performed by Contractor’s research assistants (programmers) up to an additional $100,000, resulting in a maximum of $200,000 for Contractor’s research assistants (programmers), including $100,000 invoiced for services prior to this amendment and $80,000 invoiced for services from Contractor prior to this amendment…” (emphasis in bold added)

Gruber signed the amended contract, which was effective as of November 19, on November 24. Former Vermont Secretary of Administration Jeb Spaulding signed the contract for the State of Vermont on November 25.

On Nov 19, Lawrence Miller, a senior advisor to Governor Shumlin who also serves as Chief of Health Care Reform said:

I have told Mr. Gruber that I expect his team to complete the work that we need to provide the legislature and Vermonters with a public health care financing plan. I’ve informed Mr. Gruber that that we will not be paying him any further for his part in completing that work.

As the Burlington Free Press reported at the time:

Vermont will continue to pay for the work of Gruber’s research assistants, but will not pay any additional compensation to Gruber, the health care reform chief added.

“Graduate students are not the problem,” Miller said.

Jeb Spaulding resigned as the Secretary of Administration in January, and now serves as chancellor of the Vermont state colleges system . Spaulding’s less experienced replacement, Justin Johnson, became Secretary of Administration that same month.

Despite the huge controversy that had already erupted about his billing practices, Gruber issued new invoices on December 30–more than three weeks after Vermont State Auditor Hoffer had publicly announced he was looking into Gruber’s billing practices earlier in the contract.

“It looks like he [Gruber] is trying to renegotiate the renegotiated contract. Or he is strategically positioning himself for an expected legal dispute,” one legal expert told Breitbart News.

An expert in state contracting procedures offered an even blunter analysis of Gruber’s latest billing controversy.
“It appears that Gruber has lost control over his billing practices, if he ever had any,” the state contracting expert told Breitbart News.

“Gruber clearly agreed in Vermont’s November 19, 2014 contract amendment that he would not bill for any additional services for himself. However, on December 30, 2014 he presented the state with a bill for $40,000 for his own services. The entire contractual relationship between Gruber and Vermont has been sloppy from beginning to end,” the state contracting expert said.

The expert credited Auditor Hoffer’s report as likely saving Vermont taxpayers from paying this unjustified bill.

“Based on Vermont’s lax oversight of the Gruber contract, it is likely that this bill would have been paid without question, as were all the others, had not the Vermont Auditor’s Office intervened,” the state contracting expert told Breitbart News.

Despite criticisms of Gruber’s repeated overbilling, on January 7 Robin Lunge, the Director of Health Care Reform within the Department of Administration who had oversight responsibilities for Gruber’s contract, approved the release of $20,000 in payments to Gruber for previously billed research assistant work that had been retained until the completion of the contract, according to Hoffer’s report.

That payment, however, has not yet been released.

On Tuesday, Darcie Johnston, head of Vermonters for Health Care Freedom, called on Governor Peter Shumlin to fire Lunge for her poor oversight of the Gruber contract, which Johnston said has been very costly to Vermont taxpayers.

Johnston also said another reason Lunge should be fired is she “passed on false information provided to her by Gruber to Auditor Hoffer as he conducted his inquiry.”

“On January 19,” Johnston explained, “Lunge obtained an email from Gruber in which he said his research assistant was an independent contractor. Lunge failed to ask Gruber to provide simple documentation of this claim—either a 1099, W-2, or cancelled paycheck, and passed this false claim on to Auditor Hoffer.”

It was not until February 4, when Hoffer asked Gruber to produce the 1099 to show his payments to the research assistant Gruber claimed was an independent contractor, that he learned the research assistant was instead Gruber’s employee. Gruber provided a copy of the W-2 for his research assistant employee to Hoffer at that time.

Gruber also submitted invoices totaling an additional $50,000 for 500 more hours of work by research assistants (billed at $100 per hour) on December 30. According to Gruber, these services were performed between Oct. 15 and Dec. 19.

As Breitbart News reported earlier, Gruber is charging a huge mark-up on invoices submitted for work he says was performed by research assistants. All told, he has submitted $150,000 in invoices for work he says was performed by research assistants.

However, Gruber admitted to Auditor Hoffer that he has only employed one research assistant on the Vermont project, whom he paid $32,000 in 2014, according to a W-2 Gruber provided Hoffer.

To date, Gruber has been paid $160,000 for the $200,000 he billed prior to the November amendment of the contract–$80,000 for his work and $80,000 for work he claims was completed by research assistants.

$20,000 of the work billed for research assistants work prior to November is still retained by the state, despite the initial approval by Robin Lunge.

The state has said it will not pay the $20,000 for the work billed for his personal work prior to November.

Gruber’s $40,000 billed on December 30 for personal work has not been paid and the state has said it will not be paid.

Gruber’s $50,000 billed on December 30 for work performed by research assistants in November and December has not been paid, but may be paid at some point, depending on the level of invoice itemization provided by Gruber. The level provided in the December 30 invoice is likely not to be considered sufficient by the state.

Breitbart News asked Jonathan Gruber to explain why he submitted this new $40,000 invoice for personal services, which overbills the State of Vermont again, but has not received a response.