Elon Musk’s DOGE should address Medicare and Social Security

Elon Musk and Vivek Ramaswamy want to cut $2 trillion and make government more efficient. It’s a high priority as the United States heads toward a fiscal crisis. Yet despite mounting evidence of unsustainable spending and deficits, many people seem to believe that the goals of the Department of Government Efficiency, or DOGE, are dead on arrival. Why? Because these doubters think Social Security, Medicare and Medicaid are completely off limits for cuts.

This is nonsense.

Spending on these three programs makes up about half of the $7 trillion 2025 budget, and more if you include spending on Veterans Affairs. It’s true that Musk and Ramaswamy will need Congress to help make big changes. It’s also true that cutting as much as he intends without touching Social Security, Medicare and Medicaid would set off some serious political drama. And yes, cutting Medicare and Social Security benefits is unpopular—so much so that politicians would rather ignore the issue.

However, this does not remove the rights to discounts and revisions. Mindlessly ignoring their unsustainability just because they’re popular is short-sighted and actively irresponsible. It perpetuates a political culture in which hard choices are avoided, fiscal irresponsibility accelerates, and long-term economic stability is sacrificed for short-term political expediency.

In addition, doing nothing will cut Medicare benefits by 11 percent and Social Security benefits by 23 percent in less than a decade when their respective trust funds expire. Politicians can swear on the Bible that they will not touch these programs; it’s only true if they let scheduled cuts happen.

So let me tell you why Musk and Ramaswamy’s plan isn’t dead on arrival, and how entitlement spending could be on the table without too much pain.

First, bury the myth that so-called entitlement programs—Medicare and Social Security in particular—are somehow sacrosanct or immune to legislative action. The executive branch has limited power to make changes, but Congress has all the power to reform, adjust, or even close these programs if it chooses. It is simply choosing not to address the moderate reforms we need.

That could change. The DOGE guys have the biggest microphone any tax reformer has ever had. They have succeeded in making the fiscal problems, along with the insanity of government inefficiency, visible to every American. This should motivate Congress to get off the couch and start taking our problems seriously.

Then there’s the fact that before Congress even thinks about cutting entitlement benefits, there are a lot of other steps that could be taken that would save a lot of money. For example, as it stands now, Medicare pays different rates for the same service depending on where it is provided (hospital outpatient department, ambulatory surgical center, or private physician’s office). Enforcing site neutrality would save $100 billion over 10 years.

Medicaid and Medicare are the source of at least $100 billion a year in fraud and more than $100 billion annually in improper payments. Obviously, stopping fraud should be a priority. And according to the Government Accountability Office, 74 percent of improper payments are simple overpayments. However, the government is making little effort to recover the funds.

In fact, to the extent that any effort is being made, it is by health care providers (mostly hospitals that are large beneficiaries of Medicare fee-for-service malpayments) and Congress, who are trying to slow the rate of malpayment recovery by audit. entrepreneurs. Why we should tolerate such a scandal, I do not know.

Congress also capped the amount taxpayers must repay when they receive improper payments through the Obamacare premium tax credit. The result is massive underreporting of income by taxpayers to obtain larger credits as well as other fraud schemes. scholars of the Cato Institute calculating that “removing the reimbursement limits would save taxpayers between $44 billion and more than $95 billion over ten years.”

Social security also suffers from improper non-recovered payments. Conformable program, “at the end of fiscal year 2023, the (Social Security Administration) had an uncollected excess payment balance of $23 billion.” This is not a silly change.

There could be many larger savings achievable from Social Security and Medicare that would not affect benefits if and only if Congress decides to pay attention.

The bottom line is that there is no reason, political or otherwise, to say that Musk and Ramaswamy’s plan is impossible to achieve. If it fails, it will be because Congress has refused to join the cause. And there is no reason to excuse entitlement programs from their control.