Bipartisan Budget Deal Proposal Would Extend Medicare Cuts

On Tuesday, House and Senate budget negotiators reached an agreement on a two-year budget deal that has implications for medical research and Medicare, the AP/U-T San Diego reports (Taylor, AP/U-T San Diego, 12/11).

The budget deal -- negotiated by House Budget Committee Chair Paul Ryan (R-Wis.) and Senate Budget Committee Chair Patty Murray (D-Wash.) -- would raise discretionary spending by $63 billion, from $967 billion under sequestration to $1.012 trillion in fiscal year 2014 and $1.014 trillion the next fiscal year (Newhauser, CQ Roll Call, 12/10). Overall, the deal would generate total savings of $85 billion and reduce the federal deficit by $23 billion (Bresnahan/Sherman, Politico, 12/10).

Specifically, the $63 billion increase would be divided evenly between military and domestic spending, including eliminating cuts to health research. Meanwhile, the deal would partly offset those increases by extending the sequester's 2% cut to Medicare reimbursements through 2023, two years beyond the cuts set by the Budget Control Act of 2011. The move would net about $23 billion (Weisman, New York Times, 12/10). It would not alter Medicare benefits (AP/U-T San Diego, 12/11).

According to the Times, although the deal is "modest in scope," it gives lawmakers time to focus on the "real drivers of federal spending," including health care and entitlement programs, such as Medicare (New York Times, 12/10).

In a statement, House Speaker John Boehner (R-Ohio) said, "While modest in scale, this agreement represents a positive step forward by replacing one-time spending cuts with permanent reforms to mandatory spending programs that will produce real, lasting savings."

President Obama echoed those sentiments in a statement, calling the agreement "a good sign that Democrats and Republicans in Congress were able to come together and break the cycle of shortsighted, crisis-driven decision making to get this done."

However, the accord drew criticism from conservative Republicans and groups, including Heritage Action, Americans for Prosperity and Koch Industries, who sought further cuts to domestic programs.

AFP President Tim Phillips in a statement said, "We will hold members accountable, Republican and Democrat, if they go forward and vote to raise spending above sequester levels."

Sen. Marco Rubio (R-Fla.) also spoke out against the budget deal. He said, "[T]his budget continues Washington's irresponsible budgeting decisions by spending more money than the government takes in and placing additional financial burdens on everyday Americans" (New York Times, 12/10).

Despite the criticism, both Murray and Ryan expressed confidence that their agreement would gain enough support to pass (CQ Roll Call, 12/10).

In a statement, Ryan said he is "proud of this agreement." He added, "It reduces the deficit -- without raising taxes. And it cuts spending in a smarter way. It's a firm step in the right direction, and I ask all my colleagues in the House to support it."

The House is expected to vote on the measure Friday. According to the Washington Post's "Wonkblog," the deal is expected to pass in the chamber (Klein, "Wonkblog," Washington Post, 12/10).