Some lawmakers recently have suggested that they might allow mandated spending cuts under sequestration, which includes a 2 percent reduction to Medicare reimbursement rates, to take effect on March 1. The mandated cuts involve about $1 trillion in across-the-board reductions. In January, President Obama signed legislation that delayed the cuts by two months.
Democrats and Republicans remain far apart on a potential deal to avoid the sequester. Lawmakers from both parties have indicated that they might acquiesce to the cuts. Some Democrats have said the urgency to avoid the automatic cuts has been tempered by the fact that Medicaid is exempt. Meanwhile, some Republicans believe the across-the-board reductions would be preferable to any plan that includes raising taxes.
Despite some lawmakers’ apparent willingness to allow the sequester to take effect, the White House on Friday said it would not get involved in the negotiations and would defer to Congress on how best to develop a solution for curbing the national debt. However, President Obama recently requested Republicans accept a short-term solution, including spending cuts and higher taxes, while lawmakers develop a longer-term solution.