Is Trump planning to cut Social Security, Medicare and Medicaid? What is and isn't known (2025)

President Trump’s new Department of Government Efficiency or DOGE, headed by billionaire entrepreneur Elon Musk, has started cutting staff and implementing other measures to trim costs throughout the government. Major entitlement programs of Social Security, Medicare and Medicaid are starting to feel the impact, raising concerns that more could be coming.

That has sparked a backlash that included a recent town-hall pairing of Arizona’s two Democratic U.S. senators, Mark Kelly and Ruben Gallego, who lambasted possible cuts to Medicaid during an event in Scottsdale.

These and other actions have stirred a range of emotions, from cautious hope that the federal government might finally bring its deficit spending under control to frantic fears that benefit cuts could undermine the financial or health security of millions of Americans.

A consumer sentiment index from the University of Michigan plummeted to a 15-month low in February, reflecting public anxiety about tariffs, inflation and other economic issues. The stock market has lost 7% of its value since Trump took office, while gold, a traditional hedge during troubled times, recently pushed above $3,000 an ounce for the first time ever.

Here’s what we know about what's real and what's not, plus what remains unclear:

Where does Trump stand on Social Security and other benefits?

The White House issued a statement on March 11 reiterating that the president supports these programs.

“The Trump Administration will not cut Social Security, Medicare or Medicaid benefits," the statement read. "President Trump himself has said it (over and over and over again).”

The White House also claims Musk hasn’t vowed to cut program benefits and included the following quote from him:“Thewaste and fraudin entitlement spending . . . (is) the big one to eliminate.” The quote alluded to up to $700 billion a year in waste and fraud that could be cut.

White House Press Secretary Karoline Leavitt later said Americans receiving Social Security benefits will continue to receive them. "The sole mission of DOGE is to identify waste, fraud and abuse only," she added.

Is that $700 billion figure realistic?

It appears bloated, though the three main entitlement programs do have problems.

The Social Security Administration made $71.8 billion in improper payments from 2015 to 2022, or about 0.8% of the $8.6 trillion total paid over that span, according to a report by the agency's inspector general. Most were overpayments to living recipients, the report added, not deceased individuals.

Social Security also sometimes makes underpayments to recipients, though on a smaller scale. The Social Security Administration this week said its death records are highly accurate.

Also, a Government Accountability Office report estimated $236 billion in improper payments (including some underpayments) in fiscal 2023 across 71 programs run by 14 federal agencies.

These included overpayments to deceased individuals. Of that total, $186 billion was concentrated in the five biggest problem areas: overpayments made for Medicare, Medicaid, the Earned Income Tax Credit, plus Pandemic Unemployment Assistance and the Paycheck Protection Program for loan forgiveness. The latter two programs have wound down. Medicare accounted for $51 billion and Medicaid, $50 billion.

Gallego recently co-sponsored legislation that would exempt recipients who received Social Security overpayments from having to repay money received more than 10 years earlier.

Have Musk and DOGE started to address these issues?

Yes. One of the bigger moves has been pressure by the White House for government agencies to reduce their workforces. This included a target of 7,000 job reductions by the Social Security Administration, intending to cut the agency's employment to 50,000.

Among other initiatives, 47 Social Security Administration offices have been closed or are facing closure, though none yet in Arizona. The agency recently operated roughly 1,200 offices.

Some Social Security recipients say they already have noticed a decline in service. Cynthia Malla of Clarkdale said telephone calls to the nearest office in Prescott now take more than 20 minutes, then people hear a recording asking them to try later because of high call volumes. “Then it hangs up,” said Malla in an email to the Republic. “It used to be you could leave a message requesting a callback if the call volume was high.”

And delays could get worse, with Social Security announcing that, starting March 31, it will require in-person visits for some service issues that long have been conducted over the phone, including identity verification.

This change, designed to combat fraud, “will result in more headaches and longer wait times to resolve routine customer-service needs," said Nancy LeaMond, AARP’s chief advocacy and engagement officer. “Requiring rural Americans to go into an office can mean having to take a day off of work and drive for hours merely to fill out paperwork.”

Will proposed cuts put these programs on a sound fiscal footing?

Not by themselves. That will require more fundamental reforms by Congress, though any efforts to eliminate waste or unnecessary spending will help.

Social Security retirement benefits and Medicare’s hospital insurance fund both face long-term demographic challenges that are leaving them with insufficient revenue to meet their projected costs. Fundamental reforms will require less spending or more revenue, or some combination of the two.

Reforms might include higher payroll taxes, lower benefit payments, a benefit cap for high-income individuals, a higher age at which recipients can receive full benefits (from 67 now for most current workers) or a change in the way the Social Security Administration calculates COLAs or Cost of Living Adjustments. Eliminating fraud, waste or overpayments, by themselves, probably won't do the trick.

According to a new survey by the National Academy of Social Insurance and three other groups, most Americans would favor revenue increases rather than benefit cuts to Social Security. That would include requiring high-income individuals to pay taxes on more of their earnings, to support Social Security.

What are the programs’ long-term outlooks?

“As in prior years, we found that the Social Security and Medicare programs both continue to face significant financing issues,” said the officials overseeing the programs' trust funds, in their 2024 annual report. These pressures reflect more people entering retirement amid rising health care costs, with fewer workers paying taxes to support the programs.

Social Security retirement benefits currently are supported by a trust fund that accumulated surpluses from prior years but now is drawing down those surpluses. Without substantial changes, this fund is scheduled to be depleted by 2033.

At that time, ongoing revenue from payroll taxes and other sources will be able to pay only 79% of scheduled benefits, meaning a 21% cut for recipients. The projected date is extended to 2035 if you include a Social Security trust fund for disabled workers.

The Medicare Hospital Insurance trust fund, which pays inpatient care for people 65 and up, will be insolvent and unable to pay full benefits, by 2036, according to this latest projection. At that time, hospital benefits will approximate 89% of what they’re supposed to provide.

What about Medicaid, which Kelly and Gallego discussed at their joint appearance this week?

This program pays for health care for lower-income people, some seniors, many people with disabilities and others. The Medicaid agency here is AHCCCS or the Arizona Health Care Cost Containment System.

The Trump Administration hasn’t announced any Medicaid cuts, though Kelly and Gallego predict cuts of around $880 billion will be necessary to free up some of the $6 trillion they say will be needed to pay for federal income-tax reductions advocated by Trump. “There’s no way they can get those tax cuts without gutting Medicaid,” Gallego said at the March 17 town hall in Scottsdale. “The math doesn’t work.”

Kelly and Gallego contend that trimming Medicaid, should it happen, would actually increase the health costs borne by society. For example, Medicaid cuts would resut in more emergency-room visits by desperate individuals lacking other health care possibilities, they say. The cuts also might spread infectious diseases, as uninsured sick individuals would wait longer for treatment and infect others in the meantime.

These and other factors would drive up medical costs for everyone, Gallego said at the Scottsdale event attended by around 150 people.

Kelly agreed that the government should be looking for ways to deliver health care more efficiently, but he said the Trump Administration is "talking about blanket cuts that would affect hundreds of thousands, if not millions, of people."

Will these or other proposals finally balance the federal government’s perennial budget deficit?

Probably not. Treasury Secretary Scott Bessent recently said the Administration is trying to bring down the deficits in “a responsible way,” but many observers remain skeptical.

After watching Trump’s recent address to Congress, for example, Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said the president’s budget-balancing statements can be taken in two ways.

The first would be “a positive acknowledgment of the need to prioritize fiscal responsibility” but the second would be a somber assessment of the “fiscal reality" and the policies Trump is proposing.

“America's fiscal imbalances have grown so large that balancing the budget is likely out of reach in the medium term," she said.

Reach the writer at russ.wiles@arizonarepublic.com.