Senate leaders are closing in on a deal to reopen the government and extend the U.S. debt ceiling until next year, marking a major breakthrough in an impasse that has paralyzed Washington for the last two weeks, according to several sources familiar with the talks.
In a furious round of last-ditch negotiations, Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell were discussing a proposal to reopen the government until Jan. 15 and extend the national debt limit until Feb. 7. But major fiscal decisions would be punted for a later time.
Senate Republicans and Democrats are expected to meet Tuesday to discuss the proposal and a deal could be announced later that day.
Still, its prospects in the GOP-led House are far from certain.
Several people familiar with the matter expected that a deal could be announced Monday, though its prospects in the GOP-led House are far from certain.
The plan under consideration would require larger bicameral budget negotiations to conclude by Dec. 13, sources said. Republicans would win a provision to force Kathleen Sebelius, the Health and Human Services secretary, to certify that individuals receiving Obamacare subsidies meet the required income levels. The department’s inspector general would later have to conduct an audit on the matter.
Democrats would win a labor union priority to delay for one year an Obamacare reinsurance tax, which was supposed to be levied against most insurance plans to help spread the risk for insurers who take on the sickest patients next year. Delaying the fee — $63 per person covered by an insurance plan per year — could amount to a significant boon to unions. The GOP push to kill Obamacare’s medical device tax now appears to be off the table, sources said.
If sequestration were to continue in 2014, the proposal would give federal agencies more discretion to implement the across-the-board cuts.