In 2024: Medicare Costs Will Rise as Well as the Cola for Social Security. Social Security beneficiaries can anticipate a boost in their checks next year, attributed to the annual Cost of Living Adjustment (COLA). However, this welcome news is accompanied by an uptick in medical care costs, particularly in Medicare premiums.
COLA Impact on Social Security Benefits and Medicare
In January, over 71 million seniors receiving Social Security benefits are set to receive a 3.2% COLA, translating to an average increase of approximately $59 per month. Notably, this adjustment is intertwined with Medicare premiums, as confirmed by the Centers for Medicare and Medicaid Services (CMS).
Medicare Cost Hikes in 2024
Despite the COLA increase, seniors should be prepared for a rise in Medicare costs. Medicare Part B, covering essential services like certain doctors’ visits, outpatient care, medical supplies, and preventive services, will see a 6% increase, amounting to $9.80, bringing the total to $174.70.
Additionally, the annual deductible for Medicare Part B beneficiaries will climb by $14 to $240 in 2024. The Medicare Part A inpatient hospital deductible will be $1,632, marking a $32 increase from the previous year.
Relief in Medicare Cost Increase
Contrary to initial forecasts, the actual increase in Medicare costs is lower than expected, bringing a sense of relief. The Senior Citizens League (TSCL), which anticipated a cost of $179.80, acknowledges the lesser increase, providing reassurance to beneficiaries.
Social Security COLA and Inflation Concerns
While the 3.2% COLA exceeds the two-decade average of 2.6%, concerns persist about Social Security benefits keeping pace with inflation. TSCL research reveals a 36% loss in buying power since 2000. Approximately 80% of retirees advocate for a COLA that aligns more closely with the inflation experienced by older adults.
Proposal for a “Senior” CPI
To address these concerns, TSCL and other senior advocates propose the adoption of a “senior” Consumer Price Index (CPI) to more accurately reflect the spending patterns of older Americans. Currently, the CPI used for calculating COLA does not survey costs specific to retired households over the age of 62.
Managing Retirement Finances
For those grappling with high-interest debt affecting their retirement savings, exploring options like personal loans with lower interest rates could be a strategic move. Platforms like Credible offer opportunities to consult with experts and make informed decisions to reduce monthly financial burdens.
Preparation for Retirement and Debt Management
As retirees or those preparing for retirement navigate financial decisions, addressing debt with a personal loan can be a prudent step. Credible provides a platform to compare various personal loan options, aiding individuals in selecting the most favorable interest rates for their specific needs.
Recent Concerns for Retirees Financial Security
The significant Cost of Living Adjustment (COLA) increases observed over the last three years may have unintended consequences for retirees. The increased income could potentially impact eligibility for low-income assistance programs, including SNAP (food stamps) and rental assistance, as cautioned by the TSCL (The Senior Citizens League).
Moreover, the cessation of federal emergency COVID assistance earlier this year has further heightened financial challenges for seniors relying on programs like SNAP and Medicaid.
Conclusion
While the 3.2% Social Security COLA brings some relief, rising Medicare costs highlight ongoing financial challenges for seniors. Advocacy for a “senior” CPI underscores the need for adjustments to better protect retirees from the impact of inflation.
