Social Security recipients are likely to get a boost in their benefits next year.
According to a new estimate from the Senior Citizens League, beneficiaries could receive as much as $159 extra per month in 2023, thanks to the high inflation reading for July.
The Social Security Administration uses inflation readings for July, August, and September to calculate the annual cost of living adjustment. The readings for the next two months are likely to be higher than in the past because consumer prices have remained at 40-year highs.
Mary Johnson, policy analyst and editor at the Senior Citizens League, said she is currently projecting an annual adjustment of 9.6%, which would be the biggest boost to Social Security benefits since 1981
She said that it was phenomenal. No one getting Social Security at the moment will have received a COLA of this magnitude.
An increase of 5.9% last year equates to a monthly average earnings boost of $92.30.
Social Security recipients will get a net benefit if Medicare Part B premiums go up.
According to Johnson, Medicare administrators indicated earlier this year that there might be no premium increases next year.
This year's dramatic, 14.5% increase was tied to the cost of an Alzheimer's drug and has since been cut in half.
However, beneficiaries won't get refunds this year because the Centers of Medicare and Medicaid Services agreed that they were over charged. The excess premium charges could be used to reduce the Part B premium increase in the future.
A person who works for the Centers for Medicare and Medicaid Services refused to comment. An announcement on Medicare Part B premiums is expected this fall.
Benefit payments have not kept pace with rising prices this year because people on fixed incomes have been most affected by the 40-year high inflation rates. The Senior Citizens League estimates that a Social Security benefit of $1,656 a month is $58 less than it should be.
The coming increase won't be enough for most beneficiaries to catch up with price increases on food and other consumer goods, Johnson said. 42% of participants said they received low-income assistance in the year 2021. The number of people getting needs-based assistance has more than doubled.
Social Security was never intended to be a sole source of income for people.
The consumer price index data for September will be released by the Social Security Administration in October.
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