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On Friday, the Social Security Administration announced that the cost-of-living adjustment (COLA) for 2018 will see a two percent increase in benefits from 2017, resulting in the largest adjustment since 2012.
The increase will affect more than 69 million people, including more than eight million Supplemental Security Income recipients. They’ll receive roughly $27 more a month than in 2017.
What Does This Mean for Medicare Part B Participants?
Unfortunately, all of this means higher premiums for Medicare recipients, including those participating in Medicare Part B, who haven’t seen a significant cost increase in a few years.
For about 70 percent of Medicare Part B enrollees who fall under the “hold harmless” provision, the increased Social Security money will likely get eaten up by increased Part B premiums. “Hold harmless” requires that no increase in Medicare premiums can reduce a Social Security recipients’ net monthly check below what it was in the previous year. With Social Security payments set to increase, expect to see the new Part B premiums rise with them.
AARP CEO Jo Ann Jenkins said that, while 2018’s COLA can be good news for some Social Security recipients, it “may not adequately cover expenses that rise faster than inflation including prescription drug, utility and housing costs” for recipients relying on Social Security for most or all of their income.
2018 Part B premiums will be announced sometime in the coming weeks, providing a clearer picture of what this COLA adjustment will mean for the majority of Part B enrollees.