The Council of Economic Advisers released a study finding that the opioid epidemic cost the U.S. $2.7 trillion in 2023.
The method: The study used a 2017 Centers for Disease Control and Prevention report (which found costs were $1.02 trillion) adjusted to account for inflation trends and changes in opioid deaths and opioid use disorder (OUD).
The findings:
The loss of life in 2023 cost the U.S. $1.11 trillion, based on 74,702 opioid deaths that year.
Loss of quality of life for those with OUD cost $1.34 trillion, based on 5.7 million people with OUD in 2023.
Costs to the health care system were an estimated $107 billion, amounting to an additional $19,000 per year per person with OUD, with costs primarily borne by private insurers, Medicaid and hospitals providing uncompensated care.
Loss of labor productivity due to the opioid crisis cost an estimated $107 billion.
Crime (including police protection, court proceedings, correctional facility use and property loss stemming from opioid-related crime) cost $63 billion.
The big news: Senators voted 52-48 to confirm Robert F. Kennedy, Jr. to be Department of Health and Human Services (HHS) secretary, and he was sworn into office.
Sen. McConnell voted against Kennedy, as did all Democrats.
The details: Following Kennedy’s swearing-in ceremony, Trump signed an executive orderestablishing “The President’s Commission to Make America Healthy Again,” which Kennedy will chair, to deliver a “MAHA strategy” for addressing chronic disease (particularly among children), promoting data transparency and reducing “conflicts of interest” in health research.
In an interview hours after his confirmation as HHS secretary, Kennedy outlined his priorities…
On mental health/substance use disorder: Kennedy said Americans face not only a health crisis but also a “spiritual crisis.” He suggested that addressing “diseases of isolation” would be a major focus, saying that disconnection from communities drives chronic diseases, suicide, depression, alcoholism and addiction.
On marijuana: He said that more studies need to be done on marijuana. He said he is “worried” about the “catastrophic impacts” that high-THC marijuana can have on youth but that “that worry also has to be balanced” with the facts that 24 states and D.C. have legalized marijuana and too many people have been incarcerated over the drug. Kennedy said state-level legalization allows for more intensive studies on the effects of marijuana.
BUT:
Kennedy’s lack of managerial experience and familiarity with the intricacies of HHS’ programs, and cuts to HHS’ staff and budget could limit his reach.
Federal judges have already paused the administration’s plans to cut health research grants and offer federal employees early resignations and ordered the White House to restore public health agency webpages they had taken down.
Kennedy’s responsibilities will include overseeing Medicare, Medicaid and the Affordable Care Act, but Trump has vowed not to touch Medicare, and any potential cuts to Medicaid would largely be handled by Congress.
Trump nominates experienced DEA veteran
President Trump nominated Terry Cole, Virginia’s secretary of public safety and homeland security, to be the next Drug Enforcement Administration (DEA) administrator.
The details:
Cole has more than 28 years of law enforcement experience, 22 of which he spent at the DEA.
Cole was chief of staff and executive officer at the DEA/DOJ Special Operations Division, the DEA representative to the National Security Council and chief of staff and executive officer for the DEA chief of global operations, among other roles. He retired from federal service as the acting regional director of Mexico, Canada and Central America in 2020.
Virginia Gov. Youngkin named Cole to lead the state’s public safety agencies in 2023.
The announcement:
In nominating him, Trump highlighted Cole’s tours for the DEA in Colombia, Afghanistan and Mexico and his experience leading 11 state public safety agencies, with more than 19,000 employees, as part of his current role.
Next steps: Cole will need to undergo Senate confirmation.
House Budget Committee Republicans advanced a fiscal blueprint for their reconciliation bill after weeks of delay.
The amounts: The budget resolution includes specific instructions to House committees.
Overall, it would direct committees to achieve at least $1.5 trillion in spending cuts to offset the costs to enact Trump’s domestic agenda, including tax cuts.
The Energy and Commerce Committee is instructed to cut at least $880 billion in spending, more than half of that total amount. It is a far larger number than many House Republicans had originally anticipated.
Why it’s important: That figure means lawmakers would likely need to enact deep cuts to Medicaid, as the bulk of savings would have to come from that.
Medicaid is the largest payer of substance use disorder (SUD) services. Cuts to Medicaid benefits or eligibility mean fewer people will have access to SUD care.
The details: Policies that could help lawmakers reach that target include:
Work requirements: Requiring Medicaid beneficiaries to prove they are working (or have exemptions based on certain conditions) in order to retain benefits. Most people with Medicaid are already working, but the administrative burden of proving employment results in people getting wrongfully cut from care. Work requirements are among the most politically feasible choices for Republicans.
Per-capita caps: Medicaid is an open-ended entitlement program, with the federal government reimbursing states for a percentage of care Medicaid provides. Changing the program to a block grant or instituting per-capita caps would instead give states a fixed amount of money according to the size of their population, regardless of the amount of care provided. This would likely result in states making cuts to Medicaid benefits or eligibility.
Lowering federal match rates: This could include ending the enhanced federal reimbursement for Medicaid expansion states (90% federal match vs. 50-77% otherwise) and/or lowering the minimum federal match rate generally (for all states). This would require states to pick up the slack or cut benefits, lower eligibility thresholds or reduce payments to providers.
Cuts to provider taxes and state-directed payments: States may levy taxes on providers to raise revenue from hospitals and nursing homes for their programs. States often then return those provider tax dollars to the hospitals in the form of higher reimbursement rates for Medicaid providers. These state-directed Medicaid payments have ballooned and now allow some providers to get paid similarly for seeing Medicaid and commercially insured patients. That has been good for states, hospitals and patients but contributes to high costs, making them a target.
Measures to cut waste, fraud, and abuse.
The reactions:
House Speaker Mike Johnson said before the blueprint was released that Medicaid changes under discussion included work requirements and fraud reduction, not drastic cuts such as lowering the federal match or instituting a per-capita cap. But that now doesn’t seem possible given the cuts required.
House Energy & Commerce Committee Chair Brett Guthrie acknowledged he may not be able to get enough votes for per-capita caps, though he is in favor of them.
House GOP moderates expressed alarm about the trajectory of the legislation, worried about deep cuts to programs popular among their constituents. Swing-district Republicans believe that steep spending cuts across Medicaid, food assistance and other safety-net programs could cost them their seats (and Republicans their razor-thin majority). The GOP increasingly appeals to voters who rely on government programs, in a way it has not in the past.
Republican hard-liners celebrated a concession they won from party leaders to force deeper spending cuts. Some are still suggesting they want further changes to the framework before they support it on the House floor. The blueprint includes raising the debt ceiling, which is controversial among Republicans, and several GOP members have never voted to do so.
Senate Republicans and some House hard-liners are not ready to give up on a competing two-bill plan.
President Trump last month remarked that he would “love and cherish” Medicaid, and in recent days, Trump and his aides have said privately they are worried steep Medicaid cuts would be politically radioactive.
Republican governors are likely to oppose some of the cuts, since states would have to foot more of the bill for the program and patients could lose benefits.
Democrats are blasting the blueprint and potential cuts to safety net programs (particularly as a means of paying for tax cuts).
The hospital industry/providers are against potential Medicaid cuts. If people lose Medicaid and become uninsured, hospitals face higher uncompensated care costs. Many proposals reduce the amount of federal dollars states get, and states would then have to decide whether to make up costs themselves, cut enrollment, reduce benefits or reduce what they pay providers. Cutting enrollment and benefits in a way that meaningfully curbs costs is hard, making provider cuts likely.
The public is deeply and increasingly supportive of Medicaid across the political spectrum. Even majorities of Republicans view the program favorably and want it to stay the same. Some 80 million people now get health care from Medicaid, including many working-class voters in the president’s base. Roughly two-thirds of adults in the U.S. say they or a family member or close friend have relied on Medicaid.
What’s coming: A vote by the full House on the blueprint when the House returns from recess later this month.
BUT: With a two-vote majority, Johnson has virtually no room for error, and opposition from swing-district Republicans could force him and committee chairs to go back to the drawing board. It is also far from certain how the House GOP plan will play in the Senate.
The Senate Budget Committee voted along party lines to approve their own budget resolution last week, too. Republicans in both chambers of Congress will eventually need to unite around one budget blueprint.
Then, committees will need to figure out what specific policies can get across the finish line in the reconciliation bill.
Take action: Send a letter to your members of Congress urging them to protect Medicaid.