President Obama and congressional leaders agreed to a two-stage approach to avoid looming mandated spending cuts under sequestration, which include cuts to Medicare provider payments.

The White House and congressional leaders appeared optimistic about their ability to reach a deal that would raise revenues and reduce entitlement spending, particularly for Medicare and Medicaid. In order to reach a deal, both Republican and Democratic leaders agreed to make concessions, Democrats signaling a willingness to address health care spending and reform entitlement programs, while Republicans suggested openness to increasing tax revenue.

The White House and congressional staffers have been dispatched to draft a proposed deficit-reduction framework to present to the President after the Thanksgiving break.