Seniors, disabled people to get inflation relief with big boost in benefits
Joan McCarterSeventy million Americans are getting a healthy raise in January, and it’s coming not a moment too soon. The Social Security cost of living adjustment for 2023 is 8.7%, the biggest increase in four decades. Unfortunately, it comes with persistent inflation and big increase in the consumer price index—8.5%. It also comes when Republican lawmakers and candidates are plotting how they’ll cut Social Security, already threatening to take the debt ceiling hostage to make it happen.
The increase will mean seniors and disabled people receiving benefits will get on average $140 to $145 more each month, the Social Security Administration estimated Thursday. There’s a second bit of good news for people on Social Security—the boost comes with a 3% drop in Medicare Part B premiums.
Generally, the annual increase in Social Security benefits with the cost of living adjustment are eaten up by Medicare premium increases before people even see them. But next year they’ll get the full benefit. In addition, people who are enrolled in Medicare Part D, the prescription drug benefit, will be able to get most vaccines at no cost and those with diabetes will pay less than $35 a month for insulin.
That’s because of the Inflation Reduction Act passed this summer. Thanks, Democrats!
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AARP Chief Executive Officer Jo Ann Jenkins applauded the increase in a statement Thursday. “Social Security is the largest source of retirement income for most Americans and provides nearly all income for one in four seniors. Today’s announcement of an 8.7% cost-of-living adjustment, or about an average of $145 more per month, will provide much needed relief to millions of Americans.”
“The guaranteed benefits provided by Social Security, including the annual COLA, are more crucial than ever as high inflation remains a problem for older Americans,” she added. “The automatic adjustment is an essential part of Social Security that helps ensure the benefit does not erode over time due to rising prices.”
Which is an excellent point—this isn’t really a benefit increase. It, Nancy Altman, the President of Social Security Works points out “simply ensures that seniors and other beneficiaries can tread water.”
“Unfortunately, even with today’s COLA, many simply cannot make ends meet, because their earned Social Security benefits are inadequately low. Congress should pass legislation to protect and expand Social Security, and pay for it by requiring the wealthiest to contribute their fair share.”
To that point, the SSA also announced Thursday that the cap on earnings subject to the Social Security tax will go up from $147,000 to $160,200 next year. That’s good, but still kind of ridiculous. Any earnings above $160,200 aren’t subject to the payroll tax. Lifting or eliminating the cap is just common sense for shoring up the Social Security system. Which would take away one big basis of Republican attacks—that Social Security is going broke and therefore benefits have to be cut.
That’s the line taken by the libertarian think tank Cato Institute to the news that seniors and disabled people will be struggling just a little bit less in the year ahead. Romina Boccia, the director of budget and entitlement policy, said that the increase is too generous. “Social Security is using an outdated measure that’s driving up benefit costs,” Boccia said. “Reform is long overdue.
Of course the reform conservatives want is ending Social Security and Medicare as we know it and privatizing the whole thing so their buddies on Wall Street can capitalize. Republicans have gotten brazen enough and extreme enough that if they take the House, they’ll touch that third rail and try to undo even this modest gain.
