Skip to content
Search

Latest Stories

Top Stories

Musk budget cuts will leave millions uninsured

Musk  budget cuts will leave millions uninsured

Female doctor and senior woman looking at digital tablet in exam room

Getty Images//Stock Photo

As Donald Trump begins his second term, America’s healthcare system is in crisis: medical costs are skyrocketing, life expectancy has stagnated, and burnout runs rampant among healthcare workers.

These problems are likely to become worse now that Trump has handed the job of cutting the federal budget over to Elon Musk. He will lead the newly formed Department of Government Efficiency (DOGE), a non-government entity tasked with slashing $500 billion in “wasteful” spending.


The harsh reality is that the mission can’t succeed without gutting healthcare access and coverage for millions of Americans.

Deleting dollars from American healthcare

Since Trump’s first term, the country’s economic outlook has worsened significantly. In 2016, the national debt was $19 trillion, with $430 billion allocated to annual interest payments. By 2024, the debt had nearly doubled to $36 trillion, requiring $882 billion in debt service—12% of federal spending that is legally untouchable.

Add to that another 50% of government expenditures that Trump has deemed politically off-limits: Social Security ($1.35 trillion), Medicare ($848 billion) and Defense ($1.13 trillion). That leaves just $2.6 trillion—less than 40% of the $6.75 trillion federal budget—available for cuts.

With Medicare off limits to DOGE, the options for major reductions are extremely limited. Big-ticket healthcare items like the $300 billion in tax-deductibility for employer-sponsored health insurance and  $120 billion in expired health programs for veterans will prove politically untouchable. One will raise taxes for 160 million working families, and the latter will leave veterans without essential medical care.

This shortfall will require Musk and DOGE to cut billions in government healthcare spending. But where will they find it?

In a recent op-ed, Musk and Vivek Ramaswamy proposed eliminating expired or misused funds for programs like Public Broadcasting and Planned Parenthood, but these examples account for less than $3 billion total—not even 1% of their target.

If significant reductions in cost are to be realized, DOGE will have to attack Medicaid and the ACA health. Here’s how 20 million people will likely lose coverage as a result, assuming this level of deficit savings is achieved:

1. Reduced ACA exchange funding

Since its enactment in 2010, the Affordable Care Act (ACA) has provided premium subsidies to Americans earning 100% to 400% of the federal poverty level. For lower-income families, the ACA also offers  Cost Sharing Reductions, which help offset deductibles and co-payments that fund 30% of total medical costs per enrollee. Without CSRs, a family of four earning $40,000 could face deductibles as high as $5,000 before their insurance benefits apply.

If Congress allows CSR payments to expire in 2026, federal spending would decrease by approximately  $35 billion annually. If that happens, the Congressional Budget Office expects 7 million individuals to drop out of the exchanges. Worse, without affordable coverage alternatives,  4 million families would lose their health insurance altogether.

2. Slashing Medicaid coverage and tightening eligibility

Medicaid currently provides healthcare for over 90 million low-income Americans, including children, seniors, and individuals with disabilities. To meet DOGE’s $500 billion goal, several cost-cutting strategies appear likely:

· Reversing Medicaid expansion: The ACA expanded Medicaid eligibility to those earning up to 138% of the federal poverty level,  reducing the uninsured rate from 16% to 8%. Undoing this expansion would strip coverage from millions in the 40 states that adopted the program.

· Imposing work requirements: Proponents argue this could encourage employment, but most Medicaid recipients already work for employers that don’t provide insurance. In reality, work requirements primarily create  bureaucratic barriers that disqualify millions of eligible individuals, reducing program costs at the expense of coverage.

· Switching to block grants: Unlike the current Medicaid system, which adjusts funding based on need, less-expensive block grants would provide states with fixed allocations. This will, however, force them to cut services and reduce enrollment.

Medicaid currently costs $800 billion annually, with the federal government covering 70%. Reducing enrollment by 10% (9 million people) could save over $50 billion annually, while a 20% reduction (18 million people) could save $100 billion.

Either outcome would devastate families by eliminating access to vital services, including prenatal care, vaccinations, chronic disease management, and nursing home care. As states are forced to absorb the financial burden, they’ll likely cut education budgets and reduce infrastructure investments.

The first 100 days

The numbers don’t lie: Musk and DOGE could slash Medicaid funding and ACA subsidies to achieve much of their $500 billion target. But the human cost of this approach would be staggering.

Fortunately, there are alternative solutions that would reduce spending without sacrificing quality. Shifting provider payments in ways that reward better outcomes rather than higher volumes, capping drug prices at levels comparable to peer nations, and leveraging generative AI to improve chronic disease management could all drive down costs while preserving access to care.

These strategies address the root causes of high medical spending, including chronic diseases that, if better managed, could prevent 30-50% of heart attacks, strokes, cancers, and kidney failures, according to CDC estimates.

Whether Musk and DOGE will consider the kinds of reform options I have suggested in their pursuit of immediate budgetary cuts remains to be seen.

If they choose not to, the health of millions of Americans is at major risk.

Robert Pearl, the author of “ ChatGPT, MD,” teaches at both the Stanford University School of Medicine and the Stanford Graduate School of Business. He is a former CEO of The Permanente Medical Group.

Read More

Donald Trump
How liberals' worst-case readings of Trump actually help Trump
James Devaney/GC Images

Congress Bill Spotlight: Trump Derangement Syndrome Research Act

Trump himself has diagnosed Trump Derangement Syndrome upon Joe Biden, Kamala Harris, Nancy Pelosi, Liz Cheney, Chris Christie, Robert De Niro, Jimmy Kimmel, and Bill Maher.

Context

Keep ReadingShow less
LGBTQ Refugees Came to America To Escape Discrimination. Now, They Live in Fear in the U.S.
blue and yellow abstract painting
Photo by Steve Johnson on Unsplash

LGBTQ Refugees Came to America To Escape Discrimination. Now, They Live in Fear in the U.S.

Salvadoran refugee Alberto, who is using a pseudonym out of safety concerns, did not feel secure in his own home. Being a gay man in a country known for state-sponsored violence and community rejection meant Alberto lived his life on high alert.

His family did not accept him. He says one family member physically attacked him because of his identity. He says he has been followed, harassed, and assaulted by police, accused of crimes he didn’t commit when he was studying to become a social worker. His effort to escape the rejection in his community left him, at one point, homeless and lost in a new city.

Keep ReadingShow less
Hand holding a little house with an orange roof. Conceptual image.

What domestic violence survivors in public housing need are more flexible options - and they need them now.

Getty Images, Catherine Falls Commercial

Make Housing More Secure, Not Less: Domestic Violence Survivors Need Safety

She called me while she walked her dog because it was the only time she could use the phone without being monitored by her husband. Reaching out to me as a program manager for domestic survivors in a major U.S. city, she wanted to see what her options were and where she and her seven-year-old son could go.

I went over the resources in the community for domestic violence survivors, which were few. The 35-year-old mother told me she had been in and out of domestic violence shelters over the years and could not stand to destabilize her son and herself yet again. She was living now in Section 8 housing.

Keep ReadingShow less
U.S. Refines Military Strategy in Africa As Development Programs Face Cuts

Royal Moroccan Armed Forces service members and U.S. Army Soldiers hold an African Lion banner during a Moroccan F-16 flyover at the closing day of African Lion 2025 (AL25) at Tantan, Morocco, May 23, 2025.

By Sgt. 1st Class Andrew Mallett/U.S. Army Southern European Task Force, Africa

U.S. Refines Military Strategy in Africa As Development Programs Face Cuts

WASHINGTON – Both the Trump administration and its critics agree the U.S. risks losing influence in Africa to rivals like China and Russia. But while the administration argues its commercially driven foreign policy will reverse the trend, critics warn that retreating from development and diplomacy could deepen the problem.

Under the Trump administration, the U.S. plans to consolidate embassies, scale back USAID operations, and pivot towards a security and commercial driven approach on the continent. While U.S. Africa Command (AFRICOM) defense officials insist their core missions within Africa will remain intact, civilian experts and lawmakers argue that abandoning diplomatic and development tools opens the door for strategic competitors to fill the void and fails to take into account what would best benefit African countries.

Keep ReadingShow less