DOGE, Loper Bright, Byrd, and Schumacher may sound like a law firm or an investment firm, but it is not. DOGE is the Department of Government Efficiency, not the leader of the Republic of Venice from the 8th to the 18th centuries. President-elect Trump has announced the formation of the Department of Government Efficiency (DOGE) to be headed by entrepreneurs Elon Musk and Vivek Ramaswamy. [1] They are to make their recommendations by July 4, 2026, the 250th anniversary of the Declaration of Independence.
Loper Bright Enterprises successfully sued the Secretary of the Department of Commerce for actions taken under a rule promulgated by the National Marine Fisheries Service. On June 28, 2024, the U.S. Supreme Court held that “[t]he Administrative Procedure Act (APA) requires courts to exercise their independent judgment in deciding whether an agency has acted within its statutory authority, and courts may not defer to an agency interpretation of the law simply because a statute is ambiguous; Chevron is overruled.” [2] The full impact of Loper will reverberate through all three branches of government for years to come.
Byrd is Senator Robert Byrd (D-WVA). Fifty years ago, Congress established the Congressional Budget Office, the budget committees in the Senate and House of Representatives, and a process for adopting a budget reconciliation act. That process is directed by the so-called “Byrd Rule” to determine extraneous provisions that cannot be included in budget reconciliation. The key advantage of a budget reconciliation act is it requires only a simple majority to pass the Senate rather than a three-fifths vote (60 votes).
Schumacher is E.F. Schumacher, a Rhodes Scholar economist who fled Nazi Germany and wrote Small Is Beautiful Economics as if People Mattered (which coincidentally was published the year before the Congressional Budget Act). Schumacher advocated for the decentralization of large-scale organizations along the “Principle of Subsidiarity” as a means of balancing the competition inherent in any large organization between order and creative freedom, between efficiency and innovation. It directs where authority “… best lies in a given organization for a given decision. The principle of subsidiarity holds that decision-making authority is best placed (a) where responsibility for outcomes will occur; and (b) in the closest appropriate proximity to where the actions will be taken that will produce the outcomes.” [3]
These four unrelated names could converge into a massive undertaking by the new President and 119th Congress. Why? In October, Musk declared that the federal budget could be reduced by “at least” $2 trillion. How much is $2 trillion in the context of the federal budget? In Fiscal Year 2025, total federal spending (outlays) is estimated to be $7.266 trillion, so the target represents 27.5% of total spending. Reductions in the combined outlays on Defense ($900 billion) and non-defense programs ($1.029 billion) certainly will not meet the $2 trillion goal. [4]
Mandatory spending (Social Security, Medicare, Medicaid, and other mandatory spending) accounts for $4.371 trillion-plus $965 billion in net interest on the debt. DOGE recommendations will need a budget reconciliation act to address mandatory spending and follow through on promises to significantly reduce the size of the federal government through consolidating programs, departments, and agencies.
In conjunction with these efforts, the executive branch and Congress could adopt Schumacher’s approach as an overarching strategy for adjusting to the Loper decision. Critics of the decision have expressed a dire “either/or” situation. But the response may be found in Schumacher’s wisdom that “[m]aybe what we really need is not either-or but the one-and-the-other-at-the-same-time.” In domestic public assistance programs, the federal government generally pays someone else (states, local governments, universities, hospitals, doctors etc.) to actually administer the programs or deliver services. Fewer but better new methods for measuring performance based on patient outcomes could reduce administrative burdens on states, providers, and health plans, for example, and be far more meaningful than many current measures.In conjunction with these efforts, the executive branch and Congress could adopt Schumacher’s approach as an overarching strategy for adjusting to the Loper decision. Critics of the decision have expressed a dire “either/or” situation. But the response may be found in Schumacher’s wisdom that “[m]aybe what we really need is not either-or but the one-and-the-other-at-the-same-time.” In domestic public assistance programs, the federal government generally pays someone else (states, local governments, universities, hospitals, doctors etc.) to actually administer the programs or deliver services. Fewer but better new methods for measuring performance based on patient outcomes could reduce administrative burdens on states, providers, and health plans, for example, and be far more meaningful than many current measures.
The Government Accountability Office (GAO) and various departmental Offices of Inspector General produce hundreds of reports yearly on government agency performance, billions of dollars of “improper payments” in Medicare and Medicaid, and inadequate disbursement controls. These warn that deregulation that diminishes accountability increases inefficiencies by inviting waste, fraud, and abuse.
If current structures and programs are to be torn down, the American people will want to know what will replace them. The blueprint may be based on an act of Congress and a book on economics, both of which were written 50 years ago.
HORNE, with over 60 years of experience serving the healthcare industry, including related government agencies and programs, and expertise from having monitoring and oversight responsibilities for over $110 billion in federal and state programs, stands ready to help CMS and state agencies ensure integrity, transparency and factual attestation as the path is charted for the future.
