House Republican leaders are thinking about extending the sequester to pay the $6 billion cost of reversing a cut to military pensions.
House GOP aides said their leadership could extend the automatic spending cuts to get rid of the controversial pension cut. The legislation could be tacked on to a bill raising the debt ceiling.
Republicans are meeting Monday evening to formulate their debt-limit strategy.
Extending the sequester is not a done deal, the aides said, but is getting a serious look as Republicans search for sweeteners for the debt-limit bill.
Lawmakers in both parties oppose the pension cut, which reduced the cost of living adjustment by 1 percentage point below inflation for working-age retirees. The annual cut is set to begin in December 2015.
But the two parties disagree over how to pay for reversing the cut. The Senate will hold a procedural vote Monday on a bill that would repeal the pension cuts but would not offset the savings.
Exactly how the House GOP measure would extend the sequester's lowered spending ceilings remains unclear.
In the December budget deal, for instance, $28 billion was saved by extending automatic cuts to mandatory Medicare spending by two years until 2023.
The legislation could further extend the Medicare sequester, or it could also extend the discretionary cuts to defense and non-defense spending. Sequestration for defense and non-defense discretionary spending is currently set to be in place through 2021.
— Erik Wasson contributed.