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Today’s Headlines – December 21, 2011

Good morning!

Los Angeles Times: With Payroll Tax Cut Unresolved, Congress Packs Up
After weeks of bitter partisan wrangling, the Capitol emptied for the holidays with no sign of negotiation toward a compromise that would save an expiring tax break. As of Jan. 1, the payroll tax cut that has been in place all year is scheduled to return to 6.2% from its current 4.2%, meaning that biweekly paychecks on average will be $40 smaller. Long-term unemployment benefits for some 3 million people also are poised to expire, and doctors face an estimated 20% cut in Medicare payments (Mascaro and Hennessey,12/20).

The Associated Press/Washington Post: Holiday Stalemate Over Increase In Payroll Taxes Tests Obama, Republican Lawmakers
The tax increases, as well as cuts to Medicare doctors’ fees and a lapse in jobless benefits, are due Jan. 1. They are looming even though the combatants agree that they shouldn’t happen. Instead, the warring factions have painted themselves into a corner (12/21).

For more headlines …

The New York Times: Republicans In House Reject Deal Extending Payroll Tax Cut
If no resolution can be found, House Republicans … now risk the odd political development of being accused of being the impediment to a tax cut. … The impasse deepened Tuesday with a spirited debate over the bill to reject the Senate plan and call for new negotiations, which passed 229 to 193. … Not a single Democrat joined the House Republicans in rejecting the Senate bill on Tuesday — a rare occurrence. An hour after that vote, Mr. Obama swept unannounced into his press secretary’s daily briefing with White House reporters. He called the Senate measure — which would maintain a two-month extension of a payroll tax holiday for 160 million workers, continue unemployment benefits for millions more and maintain Medicare reimbursement fees for doctors — “the only viable way to prevent a tax hike, on Jan. 1” (Steinhauer, 12/20).

The Washington Post: Congress Leaves Town With An Uneasy Stalemate And Looming Payroll Tax Hike
The House voted on Tuesday to reject a Senate compromise that would have extended a federal payroll tax holiday for two months, continued unemployment benefits for the long-term jobless and averted a cut in the reimbursement rate for doctors who treat Medicare patients. At its heart, the fight over the tax cut is only the latest incarnation of the same ideological clash that has afflicted Congress for the past year, over what the government should fund and how it should be paid for (Helderman and Kane, 12/20).

The Wall Street Journal: Standoff Sets In As House Rejects Tax Bill
House Republicans dug in for a year-end standoff Tuesday, scuttling a temporary extension to a payroll-tax break that President Barack Obama called the “only viable way” to prevent a New Year’s tax increase. …The GOP-controlled House, upending a deal that appeared set just days earlier, also demanded that Senate leaders return to Washington and negotiate a longer extension of the tax break as well as expiring benefits for the long-term unemployed and Medicare payments to doctors (Hook and Meckler, 12/21).

USA Today: House Rejects 2-Month Extension Of Payroll Tax Cut
Before the Senate adjourned, senators overwhelmingly approved a short-term patch with the intention of finding a longer term solution early next year, but House GOP leaders — at the strong urging of their rank-and-file — rejected the patch as bad economic policy. … If the current benefits expire, the impact will be immediate. The payroll tax rate will rise from 4.2% to 6.2% affecting 160 million Americans, and about 2.2 million Americans receiving long-term unemployment benefits will see their checks stop by mid-February. Additionally, the Senate bill includes another short-term patch to prevent a Medicare payment drop to doctors who treat seniors (Davis, 12/20).

The New York Times: News Analysis: A Piecemeal Approach To Health Law In States
The Obama administration’s surprise announcement Friday that it planned to give states broad leeway to pick the benefits offered under the federal health care law offers yet another example of a gradualist approach to carrying out its signal domestic policy achievement (Harris, Abelson and Pear, 12/20).

Politico: Paul Ryan Gets Pass From The Right
House Budget Committee Chairman Paul Ryan made his Republican colleagues vote on a risky Medicare overhaul plan this spring only to release a new, dialed-back plan with Sen. Ron Wyden last week. But he doesn’t seem to have been hurt by his change of direction. In fact, Ryan’s political standing among Republicans may be stronger now than it was before (Nather and Haberkorn, 12/20).

Politico/PolitiFact: Dems’ ‘Mediscare’ A Dubious Winner
Now, PolitiFact has chosen the Democrats’ claim as the 2011 Lie of the Year. It’s the third consecutive year that a health care claim has won the dubious honor. In 2009, the winner was the Republicans’ charge that the Democrats’ health care plan included “death panels.” In 2010, it was that the plan was a “government takeover of health care.” A complicated and wonky subject with life-or-death consequences, health care is fertile ground for falsehoods. The Democratic attack about “ending Medicare” was a pervasive line in 2011 that preyed on seniors’ worries about whether they could afford health care (Drobnic Holan and Adair, 12/20).

Los Angeles Times: Is The ‘Lie Of The Year’ About Ending Medicare Actually True?
Apparently, politicians are prone to fibbing when they talk about healthcare. For the last three years, the “Lie of the Year” — as determined by the fact-checking website PolitiFact — has had something to do with the way Americans get their medical care (Kaplan, 12/20).

The Wall Street Journal’s Washington Wire: Debating The Truth Of 2011’s ‘Lie Of The Year’
Did Republicans vote to end Medicare? Not according to, which on Tuesday labeled the allegation by Democrats as the “Lie of the Year” (Adamy, 12/20).

The Associated Press/Washington Post: Drugmaker Merck Agrees To Pay Massachusetts $24M To Settle Medicaid Fraud Claims
Drugmaker Merck & Co. will pay Massachusetts $24 million to settle a civil lawsuit accusing a former subsidiary of causing the state to overpay pharmacists for a widely used asthma medication. Attorney General Martha Coakley said Tuesday that the deal with Merck and 12 other drugmakers who settled