A bipartisan group of senators, also known as the Gang of Six, has proposed a deficit reduction plan that includes at least $500 billion in cuts to federal programs including Medicare and Medicaid.
The Gang of Six bipartisan plan, which would close the country's deficit by nearly $4 trillion over the next ten years, proposes a long list of sweeping measures, including $1 trillion in new revenue as well as cuts to federal programs. The proposal would implement immediate action for deep spending cuts followed by a second bill for comprehensive reform. According to the Atlanta Journal-Constitution, the proposal's provisions include the following:
• Require the congressional Finance Committee to permanently reform or replace the Medicare's Sustainable Growth Rate formula for a savings of $298 billion and find another $202 billion in savings
• Starting in 2020, require a target of holding healthcare spending to GDP plus one percent per beneficiary
• Require the Judiciary Committee to find an unspecific amount of savings through medical malpractice reform
The proposal also includes significant tax code reforms and congressional pay freezes, among other things.
President Obama has already expressed his support of the bipartisan plan, as the Aug. 2 deadline for reaching an agreement on a deficit reduction plan looms near. Failure to finalize an agreement and raise the debt ceiling by that time means the country is in danger of defaulting on its debt. Republicans and Democrats have been starkly divided on how to tackle the country's deficit, with conservatives fighting against any tax increases and Democrats defending federal entitlement programs such as Medicare and Medicaid.
Just hours after President Obama delivered his public praise of the plan, the GOP-controlled House voted to pass separate legislation. The Cut, Cap and Balance Act focuses on trillions of dollars in spending cuts; a majority vote in both houses for any tax increases; and an amendment for a balanced budget in exchange for raising the debt ceiling, according to a New York Times news report.
Despite the House's passage of the bill, it is largely expected to be shot down in the Senate.
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The Gang of Six bipartisan plan, which would close the country's deficit by nearly $4 trillion over the next ten years, proposes a long list of sweeping measures, including $1 trillion in new revenue as well as cuts to federal programs. The proposal would implement immediate action for deep spending cuts followed by a second bill for comprehensive reform. According to the Atlanta Journal-Constitution, the proposal's provisions include the following:
• Require the congressional Finance Committee to permanently reform or replace the Medicare's Sustainable Growth Rate formula for a savings of $298 billion and find another $202 billion in savings
• Starting in 2020, require a target of holding healthcare spending to GDP plus one percent per beneficiary
• Require the Judiciary Committee to find an unspecific amount of savings through medical malpractice reform
The proposal also includes significant tax code reforms and congressional pay freezes, among other things.
President Obama has already expressed his support of the bipartisan plan, as the Aug. 2 deadline for reaching an agreement on a deficit reduction plan looms near. Failure to finalize an agreement and raise the debt ceiling by that time means the country is in danger of defaulting on its debt. Republicans and Democrats have been starkly divided on how to tackle the country's deficit, with conservatives fighting against any tax increases and Democrats defending federal entitlement programs such as Medicare and Medicaid.
Just hours after President Obama delivered his public praise of the plan, the GOP-controlled House voted to pass separate legislation. The Cut, Cap and Balance Act focuses on trillions of dollars in spending cuts; a majority vote in both houses for any tax increases; and an amendment for a balanced budget in exchange for raising the debt ceiling, according to a New York Times news report.
Despite the House's passage of the bill, it is largely expected to be shot down in the Senate.
Related Articles on Debt Ceiling Talks:
HIMSS: Ongoing Deficit Battle Will Not Threaten Meaningful Use FundsNational Governors Association Urges Deficit Negotiation Leaders to Avoid Cost-Shifting to States
Cuts to Medicare, Medicaid Loom as Debt Ceiling Limit Nears