12/23 UPDATE: House Republican leaders have publicly confirmed the deal is on, and Politico reports that the House and Senate are meeting this morning to pass a two-month extension of the payroll holiday tax bill, which includes a two-month freeze of the 27 percent Medicare reimbursement cut to doctors. As a condition of the deal, the House and the Senate have agreed to meet after the holiday recess to hammer out a full one-year extension, which the House GOP had earlier been holding out for.

House Republicans have apparently agreed to pass a two-month extension of a payroll tax holiday, a bill that includes a two-month freeze on Medicare pay cuts. Citing unnamed Democratic and Republican sources, National Journal said House Republicans caved in to pressure from their leaders and the Obama administration, concluding several weeks of political turmoil in Washington.

The agreement is expected to be announced at 5 p.m. during a conference call on Thursday.

Earlier in the day Senate Minority Leader Mitch McConnell (R-Kentucky) called on his colleagues in the House to agree to a short-term extension, and President Obama said he would hold off on his Christmas plans until they worked something out.

The National Journal said Republicans accepted the deal after Senate Majority Leader Harry Reid (D-Nev.) agreed to appoint senators to form a committee to hammer out differences between the Senate's bill, which extends the tax break for two months, and a bill passed by the House, which extends it for one year.

The new bill will also apparently include language making it easier for businesses to implement the tax cut, the National Journal said.

Without any legislative intervention, doctors are looking at a 27 percent Medicare reimbursement cut in January, under the sustainable growth rate (SGR) formula.