Cost-of-Living Adjustment (COLA) Information for 2022
Social Security announces 5.9% cost-of-living adjustment (COLA) benefit increase for 2022, the largest COLA adjustment since 1982. An average beneficiary will see around $90 added to their check each month, not accounting for any yet to be announced increases in Medicare Premiums. Taxable maximum income, earnings limits for retirees, and several related amounts also increased. See the SSA press release below.
Social Security and Supplemental Security Income (SSI) benefits for approximately 70 million Americans will increase 5.9 percent in 2022, the Social Security Administration announced today.
The 5.9 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2022. Increased payments to approximately 8 million SSI beneficiaries will begin on December 30, 2021. (Note: some people receive both Social Security and SSI benefits). The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor’s Bureau of Labor Statistics.
Some other adjustments that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $147,000 from $142,800.
Social Security and SSI beneficiaries are normally notified by mail starting in early December about their new benefit amount. Most people who receive Social Security payments will be able to view their COLA notice online through their personal my Social Security account. People may create or access their my Social Security account online at www.socialsecurity.gov/myaccount.
Information about Medicare changes for 2022, when announced, will be available at www.medicare.gov. For Social Security beneficiaries receiving Medicare, Social Security will not be able to compute their new benefit amount until after the Medicare premium amounts for 2022 are announced. Final 2022 benefit amounts will be communicated to beneficiaries in December through the mailed COLA notice and my Social Security’s Message Center.
How Is the Medicare Part B Premium and Deductible Determined Each Year?
Medicare Rates and Deductibles for each year usually are announced in mid-November and are linked to the Cost of Living Adjustment (COLA), which is announced by Social Security each year in October. The Secretary of the Department of Health and Human Services is required by section 1839 of the Social Security to announce the Part B monthly actuarial rates for aged and disabled beneficiaries as well as the monthly Part B premium. The Part B annual deductible is included because its determination is directly linked to the aged actuarial rate. The premiums paid by (or on behalf of) all enrollees fund approximately one-fourth of the total incurred costs, and transfers from the general fund of the Treasury pay approximately three-fourths of these costs.
2021 Calculations on Federal Register:
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