Despite Debt Stalemate, Obama Opposes Plan To Repeal Automatic Cuts

Last week, President Obama said he will not sign legislation that would repeal automatic spending reductions that would take effect if the debt panel fails to agree on a deficit-reduction proposal before Thanksgiving, the Wall Street Journal reports (Hook/Bendavid, Wall Street Journal, 11/12).

Sen. Pat Toomey (R-Pa.) said on "Fox News Sunday" that if the debt panel does not reach an agreement by the Nov. 23 deadline, a "lively debate" likely will occur about whether to allow enactment of the $1.2 trillion in automatic cuts included in the recent debt deal.

Toomey said, "I think it's very likely that Congress would reconsider the configuration of that sequestration, and consider is this really the best way to do it?" He said the debate likely would involve the "nature of those cuts -- which I think the cuts have to occur, but they might occur in a different fashion" (House/Catalini, National Journal, 11/14).

However, the White House in a statement said, "The sequester was agreed to by both parties to ensure there was a meaningful enforcement mechanism to force a result from the committee," adding, "Congress must not shirk its responsibilities."

On Friday, Obama made separate calls to panel leaders Sen. Patty Murray (D-Wash.) and Rep. Jeb Hensarling (R-Texas) urging them not to seek repeal of the cuts (Kim, Politico, 11/11).

Deal Still Possible

Although the debt panel has been at an impasse as of late, some observers believe a deal still is within the panel's reach, according to the Journal. They note that Republicans recently have ceded ground on revenue-generating tax increases, while Democrats have offered to accept entitlement cuts.

Maya MacGuineas, president for the Committee for a Responsible Federal Budget, said, "For the first time since the process started, I'm thinking it's more likely than not that they come away with a deal," adding, "People are pushing themselves outside their comfort zone."

Jacob Lew, director of the White House Office of Management and Budget, said that in his experience budget deals often do not come together until very late in negotiations. He said, "Conversations continue to go on. The parties are continuing to explore options. They don't want to fail" (Wall Street Journal, 11/12).

Panel Could Put Off Tax Decision

As the Nov. 23 deadline approaches, the debt panel might try to limit contentious debate by deferring difficult tax decisions to congressional tax-writing committees, the Los Angeles Times reports.

According to the Times, the strategy would involve the panel agreeing to a new level of revenue from taxes, then allowing committees to overhaul the tax code. In the meantime, the panel would come to an agreement on the remainder of a deficit-reduction deal (Mascaro, Los Angeles Times, 11/11).

AMA Coalition Wants Panel To Repeal SGR

A coalition of more than 100 physicians groups led by the American Medical Association asked the panel on Thursday to repeal the formula that calculates physician reimbursements under Medicare, CQ HealthBeat reports (Bristol, CQ HealthBeat, 11/11).

The coalition in a letter to Hensarling wrote, "The uncertainty and instability that the annual threat of SGR-related payment cuts cause for physician practices cannot be overstated," adding, "With cuts of this magnitude pending, Congress should not wait until the eleventh hour to take action" (CQ HealthBeat, 11/11).

Lawmakers Seek Cuts to Tricare

Meanwhile, lawmakers are encouraging the debt panel to reduce government spending on Tricare for military retirees under age 65, as part of $51 billion in cuts to defense health programs, National Journal reports.

Working age military retirees are eligible for Tricare benefits, which cost them $460 annually in premiums. Certain lawmakers see it as an ideal place to reduce Department of Defense health costs, especially since the wars in Afghanistan and Iraq are on the decline.

Senate Armed Services ranking member John McCain (R-Ariz.) recommended that the committee restrict military retirees from using Tricare Prime, the lowest-cost Tricare program. The strategy could save $111 billion over a decade, according to the Congressional Budget Office (McCarthy, National Journal, 11/14).