Social Security and Medicare are by far the biggest contributors to our national debt. The federal government spent $1.6 trillion and $992 billion, respectively, on these programs in fiscal 2025. President Donald Trump promised during his campaign that he would “not cut one penny from Social Security or Medicare,” making it unlikely that there would be progress on lowering federal spending during his presidency. But his administration has made several regulatory changes that lower Medicare spending in a responsible and prudent way.

The most significant is the administration’s push for site-neutral payment reform. For years, Medicare has paid vastly different rates for the same service depending on where it is delivered. The Affordable Care Act has made this problem worse. A routine procedure performed in a hospital outpatient department can cost taxpayers and seniors far more than when it is done in a physician’s office, despite there being no meaningful difference in quality. This distorted payment structure has encouraged hospital systems to buy up independent practices and shift care into higher-cost settings, driving consolidation, monopolization, and higher prices.