WSJ What’s News - DOGE Aides Look Into Medicare Agency Payment Systems

Episode Date: February 5, 2025

P.M. Edition for Feb. 5. Representatives from Elon Musk’s Department of Government Efficiency have been reviewing data at the Centers for Medicare and Medicaid Services. WSJ reporter Anna Wilde Mathews tells us what we know about the kind of data they’re looking at, and why. Plus, President Trump signs an executive order banning transgender girls and women from participating in school and college sports. We hear from WSJ White House correspondent Natalie Andrews about the impact of the order. And Google announces a rollback of its diversity hiring targets. Alex Ossola hosts. Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

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by March 15th. Additional terms apply. Learn more at Wealthsimple.com slash match. Doge representatives are searching payment systems at the Centers for Medicare and Medicaid Services. 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. 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 Osala 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 U.S. 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 quote 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? This executive order will have the effect of banning transgender girls and women from playing in sports that are for women or 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 was one of the first things he would do if elected. And how will this be enforced? 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 U.S. 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. How has this new executive order been received? 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 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. That was WSJ White House correspondent, Natalie Andrews. We mentioned this morning that the US Postal Service said that it would stop accepting parcels from China and Hong Kong. Well, don't worry, our Shian 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.

that oversees Medicare and Medicaid Services. 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. Anna Wieldy Matthews, who covers health insurance for the journal, is here to tell us more. Anna, what are Doge employees looking to do here? 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. CMS seems like a particularly sensitive agency, both politically and economically. What's potentially at stake here? KESHIA POLLIN 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.

Given what's been going on at USAID with the agency effectively closed, I'm curious, could something like that happen at CMS? 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. So we don't have any comments yet so far from DOJ or the White House, but has the agency itself said anything? A CMS official said in a statement that the agency has two senior agency veterans who

are leading the coordination with DOJ 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 WSJ reporter Anna Wieldy-Matthews. Thank you, Anna. Thank you. 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 U.S. stock indexes closed higher.

The Nasdaq climbed about 0.2 percent, the S&P 500 rose approximately 0.4 percent, and the Dow ticked up roughly 0.7 percent. 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+, 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 Wurtz, 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. 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 private debt deal.

They need so much money to build, to meet the demand that's coming from the chat GPTs of the world, the Microsofts of the world, the Amazons of the world, etc. 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 Bansi with supervising producer Michael Kosmitis. I'm Alex Osala for The Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening!