It looks like they are taking another approach, still not sure if this would pass SCOTUS muster, as it creates a de facto way for the President to introduce legislation, which is not an executive power, and that rationale is what led SCOTUS to shoot down the line-item veto during the Clinton years:
http://thecaucus.blogs.nytimes.com/2010/06/09/line-item-veto-alternative-offered/
The administration supports the Senate version, an official said. It would require a president to send Congress proposed rescissions within 45 calendar days after signing an appropriations measure – sooner than the 45 Congressional business days that Mr. Obama proposed as a deadline. Congress would have to consider the president’s rescissions proposal immediately and the House and Senate could not amend it.
About the only thing that could pass SCOTUS muster, IMO, would be a Constitutional Amendment.
And why would the Reps go along with giving Obama more power? Obama could use the threat of line item vetos to push his agenda. Stupid given who occupies the WH.