DOGE Aides Look Into Medicare Agency Payment Systems

Summary

WSJ What’s News – Episode Summary: DOGE Aides Look Into Medicare Agency Payment Systems Release Date: February 5, 2025
Host: The Wall Street Journal

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1. International Response to President Trump’s Gaza Proposal

The episode opens with Alex Osola discussing President Trump's controversial plan to take over Gaza and permanently relocate Palestinians. The initiative has met widespread condemnation from key Middle Eastern powers. Saudi Arabia firmly rejected any displacement efforts, reiterating support for a Palestinian state and declaring its stance as non-negotiable. Turkey’s Foreign Minister labeled the proposal as "absurd," and other nations including Egypt, Jordan, the United Arab Emirates, Qatar, and Palestinian leaders voiced strong objections, citing moral and security concerns.

Notable Quote:

"Saudi Arabia said it rejected any efforts to displace Palestinians from their land. It reaffirmed support for a Palestinian state and said its position was non-negotiable." – Alex Osola (00:55)

2. Google Abandons DEI Hiring Goals

Google announced a significant shift in its hiring strategy by abandoning its commitment to increasing the representation of historically underrepresented groups. The company is reevaluating its diversity, equity, and inclusion (DEI) programs in light of recent court decisions and Executive Orders from President Trump aimed at limiting DEI initiatives within the government and among federal contractors.

3. President Trump’s Executive Order on Transgender Athletes

A substantial portion of the episode is dedicated to President Trump's newly signed executive order that prohibits transgender girls and women from participating in female sports at schools and colleges. Ana Wielty Matthews explains that schools violating this directive risk losing federal funding. The Department of Justice will enforce the order, and the State Department will review visas of foreign athletes to ensure gender compliance, potentially impacting international sporting events hosted in the U.S.

Notable Quotes:

"This executive order will have the effect of banning transgender girls and women from playing in sports that are for women and girls." – Ana Wielty Matthews (02:59)

"The Department of Justice will be allowed to enforce this. It also opens the schools up to lawsuits from sports, from athletes." – Ana Wielty Matthews (03:59)

The order has garnered support from various women's groups and Republican lawmakers, with a celebratory signing ceremony at the White House featuring outspoken athletes.

4. USPS Updates on Parcel Acceptance from China and Hong Kong

Following concerns about delivery disruptions, the U.S. Postal Service confirmed it would resume accepting parcels from China and Hong Kong. USPS is collaborating with Customs and Border Protection to implement an efficient collection mechanism for the new China tariffs, aiming to minimize disruptions to package deliveries, including those from popular retailers like SHEIN and TEMU.

5. DOGE’s Investigation into Centers for Medicare and Medicaid Services (CMS)

The episode dives into the exclusive report on representatives from Elon Musk's Department of Government Efficiency (DOGE) conducting an audit of CMS’s payment and contracting systems. Natalie Andrews elaborates that DOGE is investigating potential fraud, questionable payments, and evaluating CMS’s technological infrastructure and organizational structure.

Notable Quotes:

"The idea appears to be looking for fraud or potentially questionable payments, as well as examining the technology and also looking at the organizational design and staffing at the agency." – Natalie Andrews (06:47)

"CMS oversees really some of the most central and widespread programs that the federal government has, particularly Medicare... [with] outlays of about $1.5 trillion in fiscal 2024, and that's about 22% of the federal total outlays." – Natalie Andrews (07:09)

While CMS remains cautious, stating that seasoned agency veterans are coordinating with DOGE, the implications of this investigation are significant given CMS's critical role in federal healthcare programs.

6. Market Movements and Corporate Earnings

Despite investor concerns over President Trump’s threatened tariffs, the major U.S. stock indexes showed gains:

• Nasdaq: +0.2%
• S&P 500: +0.4%
• Dow Jones: +0.7%

Key corporate performances included:

• Disney: Reported a $293 million profit in its streaming division, surpassing expectations. Plans to consolidate streaming services under Disney+ with exclusive live sports content.
• Ford Motor: Increased fourth-quarter revenue and a 2.4% rise in net income for 2024, though anticipating a significant earnings drop due to losses in the electric vehicle sector.
• Qualcomm: Achieved record quarterly sales with a 17% revenue increase to approximately $11.7 billion, outpacing analyst forecasts.

7. The Future of Artificial Intelligence and Investment Trends

The discussion shifts to the burgeoning field of artificial intelligence (AI) and the substantial investments fueling its growth. Matt Wirtz from the Wall Street Journal highlights that top companies could invest around $3 trillion in AI and its infrastructure by 2030. Significant financial commitments are being made towards data centers and digital infrastructure to support AI advancements.

Notable Quote:

"The deals that we picked, each one is a little bit different. One of the things that they all have in common is that they have billions attached to the numbers." – Matt Wirtz (10:20)

Wirtz specifically mentions Blue Owl’s $1 billion investment in the first data center for the Stargate venture and Digital Realty’s impressive $10 billion fundraising efforts to meet the escalating demand from major tech giants.

8. Closing Remarks

The episode concludes with a recap of the day's top stories, emphasizing the dynamic interplay between political decisions, corporate strategies, and market responses. Listeners are encouraged to stay tuned for future episodes for more comprehensive coverage.

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Produced by: Anthony Bancy
Supervising Producer: Michael Kosmides
Host: Alex Osola

For more in-depth discussions, you can listen to the full episode of WSJ What’s News.

Transcript

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[Alex Osola]

Doge representatives are searching payment systems at the Centers for Medicare and Medicaid Services.

[Natalie Andrews]

CMS oversees really some of the most central and widespread programs that the federal government has, particularly Medicare. But it also has custody of very personal, sensitive health information that people all over the country probably feel strongly about.

[Alex Osola]

Plus, President Trump has signed an executive order that bans transgender girls and women from participating in school and college sports and Middle Eastern Leaders React to Trump's proposal to take over Gaza It's Wednesday, February 5th. I'm Alex Osila for the Wall Street Journal. This is the PM edition of what's News, the top headlines and business stories that move the world today. We're starting off this evening with international news. In this morning's show, we talked about President Trump's plan for the US to take over Gaza and permanently move Palestinians out. Now, major powers in the Middle east have weighed in and Trump's proposal isn't proving to be very popular. Saudi Arabia said it rejected any efforts to displace Palestinians from their land. It reaffirmed support for a Palestinian state and said its position was non negotiable. The foreign minister of Turkey, a NATO member, called Trump's idea absurd. In recent weeks, Egypt, Jordan, the United Arab Emirates, Qatar and Palestinian leaders have also rejected the idea of relocating Palestinians from the Gaza Strip, citing both moral objections and security risks. We're exclusively reporting that Google is eliminating its goal of hiring more employees from historically underrepresented groups and reviewing some diversity, equity and inclusion programs. In an email to employees today, Google said it would no longer set hiring targets to improve representation in its workforce and that it was reviewing recent court decisions and executive orders by President Trump aimed at curbing DEI in the government and federal contractors. President Trump has signed an executive order that would strip federal funding from schools that allow transgender girls and women who were assigned male at birth to participate in female sports events in schools and colleges. The National Collegiate Athletic association has already indicated that it will move rapidly to change its rules in the face of an order affecting almost every one of its 1,100 member schools. WSJ White House correspondent Natalie Andrews joins me now with more. So, Natalie, what will this new order entail?

[Ana Wielty Matthews]

This executive order will have the effect of banning transgender girls and women from playing in sports that are for women and girls. So anything such that is women's college sports or school sports, if universities or schools want to receive federal funding, they will not be able to do that if they allow transgender girls or transgender women to play in the sports. This was a key campaign issue for Donald Trump. He talked about it at nearly every single campaign event. He would play videos about it. This is something that he felt really galvanized his base. They talked a lot about really opposing any sort of transgender acceptance. They did not like that. And he said that this is one of the first things he would do if elected.

[Alex Osola]

And how will this be enforced?

[Ana Wielty Matthews]

The Department of Justice will be allowed to enforce this. It also opens the schools up to lawsuits from sports, from athletes. There was one unique thing that I don't think people were expecting, but the State Department will be forced to review visas of foreign athletes who come into the US for competitions to make sure that they are competing in the gender they were assigned at birth. And that could have implications for the Olympics, for international sporting events that are hosted in the US So that will be one to watch.

[Alex Osola]

How has this new executive order been received?

[Ana Wielty Matthews]

There are a lot of women's groups who have been pushing for this. There's also a lot of Republican lawmakers who have backed this. They were at the signing today at the White House. It was not a typical signing that Donald Trump has done. It was a East Room celebration of sorts. They allowed a lot of guests to come. They invited athletes who have been outspoken on this topic. So they really seized the moment.

[Alex Osola]

That was WSJ White House correspondent Natalie Andrews. We mentioned this morning that the U.S. postal Service said that it would stop accepting parcels from China and Hong Kong. Well, don't worry. Our SHEIN and TEMU orders are safe. After temporarily suspending the service and sparking concerns about delivery disruptions, the USPS said it would resume accepting those parcels. It said it was working closely with Customs and Border Protection to create, quote, an efficient collection mechanism for the new China tariffs to ensure the least disruption to package delivery. Coming up, what DOGE employees are looking for at the agency that oversees Medicare and Medicaid. That's after the break.

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[Alex Osola]

We'Re exclusively reporting that representatives of Elon Musk's Department of Government Efficiency have been working at the Centers for Medicare and Medicaid Services. According to people familiar with the matter, DOGE employees have gotten access to key payment and contracting systems, though not to databases with identifiable personal health information. Ana Wielty Matthews, who covers health insurance for the Journal, is here to tell us more. Ana, what are DOGE employees looking to do here?

[Natalie Andrews]

The idea appears to be looking for fraud or potentially questionable payments, as well as examining the technology and also looking at the organizational design and staffing at the agency.

[Alex Osola]

CMS seems like a particularly sensitive agency, both politically and economically. What's potentially at stake here?

[Natalie Andrews]

CMS oversees really some of the most central and widespread programs that the federal government has, particularly Medicare, also the federal part of Medicaid and other health programs. It had outlays of about $1.5 trillion in fiscal 2024, and that's about 22% of the federal total outlays. So that just gives you a sense of the scope of the money that's involved. But it also has custody of very personal, sensitive health information that people all over the country probably feel strongly about.

[Alex Osola]

Given what's been going on at usaid. With the agency effectively closed, I'm curious, could something like that happen at cms?

[Natalie Andrews]

I think it's probably too soon to tell exactly how things will play out, and what we reported is all we know. It seems unlikely that anything like what happened at USAID could happen at cms. It oversees very central functions that are, as we said, politically sensitive. But I don't think anyone yet necessarily knows how things are going to play out.

[Alex Osola]

So we don't have any comments yet so far from DOGE or the White House. But has the agency itself said anything?

[Natalie Andrews]

A CMS official said in a statement that the agency has two senior agency veterans who are leading the coordination with doge, and that CMS leaders are, quote, taking a thoughtful approach to see where there may be opportunities for more effective and efficient spending in line with meeting the goals of President Trump that was.

[Alex Osola]

WSJ reporter Ana Wielty. Matthews. Thank you, Ana.

[Natalie Andrews]

Thank you.

[Alex Osola]

Relatively muted trading today suggests that investors have calmed their nerves since President Trump's threatened tariffs, while earnings drove some big moves. All three major US stock indexes closed higher. The Nasdaq climbed about 0.2%, the S&P 500 rose approximately 0.4%, and the Dow ticked up roughly 0.7%. Streaming gains boosted Disney's performance in the final three months of last year. The company reported today a profit of $293 million for its entertainment streaming business, exceeding analyst expectations. Now Disney plans to centralize its streaming portfolio into Disney plus, adding new live sports shows that will be exclusive to the platform. Reporting after the bell, Ford Motor posted higher revenue and a 2.4% increase in net income for the fourth quarter of 2024. But for this year, it's expecting a significant drop in earnings as deep losses generated by its electric car business will continue to weigh on profitability. And Qualcomm, one of the largest suppliers of communications and number crunching chips, reported record quarterly sales. The company said revenue rose 17% in its latest quarter to about $11.7 billion, ahead of analysts expectations. Evangelists of artificial intelligence say the technology is poised to change the world. But to get there, companies need a ton of money. According to BlackRock Investment Institute, some of the biggest companies could spend about $3 trillion on AI and its infrastructure by 2030. Matt Wirtz, who covers credit for the Wall Street Journal, spoke to our Tech News Briefing podcast about some of the big financial bets being placed in the new digital economy.

[Matt Wirtz]

The deals that we picked, each one is a little bit different. One of the things that they all have in common is that they have billions attached to the numbers. So these are very large transactions. One that I thought was super interesting was because it's going to fund the first data center for Stargate, which is this very glitzy announced venture by President Trump and OpenAI and SoftBank and Oracle. Their first data center is actually being funded by this company that I know as like a private credit fund called Blue Owl. They're very fast growing, but they're pretty new to data centers. And they're putting a billion dollars of their own money into building this new data center. Another series of transactions, it's for this company called Digital Realty, which operates a huge portfolio of data centers. But in the last year, they have raised a really just amazing amount of money. I mean, close to $10 billion in lots of different forms. So they've done a private debt deal. They've done a couple of, I guess you would call it venture capital raises. And then they've gotten money from regular big banks like JP Morgan and Goldman Sachs. So that just showed the breadth of the money sources that these companies have to look at because they need so much money to build to meet the demand that's coming from the chatgpts of the world, the Microsofts of the world, the Amazons of the world, et cetera.

[Alex Osola]

To hear more from Matt, check out today's Tech News Briefing podcast. And that's what's news for this Wednesday afternoon. Today's show is produced by Anthony Bancy with supervising producer Michael Kosmides. I'm Alex Osola for the Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening.