Social Security beneficiaries will be getting a little more money in 2018. The Social Security Administration has released its Cost-of-Living Adjustment (COLA) for 2018. It’s based on the Consumer Price Index (CPI-W) between the third quarter and 2016 and the third quarter of 2017.
Social Security and Supplemental Security Income beneficiaries will receive a 2 percent increase in payments. A person with a $1,300 monthly benefit will see an increase of $26. This is a much more substantial increase than what has been seen in recent years.
However, some people may not actually receive the money. Some Medicare B participants who also receive Social Security benefits are protected by the “hold harmless” clause, which prevents them from having to pay higher Medicare premiums if the COLA increase does not cover the premium increase.
In 2017, the COLA increase was only .3 percent. The standard Medicare Part B premium was $134, but because the COLA increase did not cover the premium increase, many people did not pay the full amount. Instead, individuals who paid their premium through Social Security deductions paid $109 on average, a difference of $25.
In 2018, people who have been protected from rising Medicare premiums thanks to the “hold harmless” provision may see their COLA increases go to paying Medicare premiums, and not into their pockets.
