Possible near 3% SS hike for 2019?

[bizlady]

No one knows for sure, but interesting read https://www.fool.com/retirement/2018/07/08/an-early-peek-at-social-securitys-2019-cola.aspx

 

[braumeister]

Certainly possible, if you look at the trend.
But it would take sustained increases through the summer and historically that's somewhat unlikely. Should be good for at least another 2% though IMHO.

 

[Dtail]

2% would be fine, but will they raise the 134 Medicare Part B premium?

 

[pb4uski]

And for some people who currently pay less than $134 based on hold harmless, all or a portion of their COLA increase will get absorbed.... right?

 

[MissMolly]

And for some people who currently pay less than $134 based on hold harmless, all or a portion of their COLA increase will get absorbed.... right?

Right.

 

[Helena]

.

I read the SS COLA might be a little more than 3%
and the 2019 Medicare B premium either might not
increase at all or only increase a couple of dollars.
This means we might actually get to keep most
of the SS increase in 2019.

 

[Dtail]

And for some people who currently pay less than $134 based on hold harmless, all or a portion of their COLA increase will get absorbed.... right?

My DGF was caught up last year with the increase.
This brings another concept into play!!!!
When one is deciding when to take SS, the "hold harmless" concept is sometimes factored into the decision (perhaps a more minor part of the equation), so if one ends up not really being held harmless over a period of years, how useful is this part of the equation?

 

[audreyh1]

My DGF was caught up last year with the increase.
This brings another concept into play!!!!
When one is deciding when to take SS, the "hold harmless" concept is sometimes factored into the decision (perhaps a more minor part of the equation), so if one ends up not really being held harmless over a period of years, how useful is this part of the equation?

It’s temporary. You eventually catch back up.

If subject to IRMAA you are never held harmless. Neither are first year Medicare folks.

 

[Helena]

My DGF was caught up last year with the increase.
This brings another concept into play!!!!
When one is deciding when to take SS, the "hold harmless" concept is sometimes factored into the decision (perhaps a more minor part of the equation), so if one ends up not really being held harmless over a period of years, how useful is this part of the equation?

The "hold harmless" provision guarantees your current SS amount will not go down due to an increase in your Medicare B premium. But that guarantee does NOT cover the yearly COLA [if any.] So some or all your COLA could go to a Medicare B premium increase. This happened to many people in 2018.

.

 

[Helena]

It’s temporary. You eventually catch back up.

If subject to IRMAA you are never held harmless. Neither are first year Medicare folks.

2017 was my first year. My SS amount did decrease to pay the $134 a month Medicare B premium while the "hold harmless" group was paying less. But I was able to enjoy all of the 2018 COLA [while the "hold harmless" group was catching up.]

.

 

[Dtail]

The "hold harmless" provision guarantees your current SS amount will not go down due to an increase in your Medicare B premium. But that guarantee does NOT cover the yearly COLA [if any.] So some or all your COLA could go to a Medicare B premium increase. This happened to many people in 2018.

.

Yes that is my point in that how valuable is the hold harmless aspect when deciding whether to take SS early, if it eventually gets caught up.

 

[Helena]

Yes that is my point in that how valuable is the hold harmless aspect when deciding whether to take SS early, if it eventually gets caught up.

I took early SS at age 62 had COLAs but no Medicare B premium until eligible for Medicare at age 65. In 2017 at age 65 I paid the Medicare B premium in effect at that time, $134 a month. Now, beginning in 2018, I am not subject to IRMAA and I am protected by that same hold harmless provision. Now it doesn't matter how much my Medicare B premium goes up, my SS amount will never go down [although future COLA increases might be affected.]

Disturbingly, after reading some recent news articles, I get the impression the media is trying to spin the SS "hold harmless" provision as a negative... when it actually serves to protect SS recipients.

.

 

[MissMolly]

Disturbingly, after reading some recent news articles, I get the impression the media is trying to spin the SS "hold harmless" provision as a negative... when it actually serves to protect SS recipients.

.

I can actually see both sides of this argument as being valid. On one hand, you have seniors, many of whom live on SS alone, needing to maintain that check in order to live. On the other hand, the Medicare fund is seriously underfunded. By allowing hundreds of thousands of SS recipients not pay their full share, it only makes this worse. It's a conundrum for sure.

 

[Helena]

I can actually see both sides of this argument as being valid. On one hand, you have seniors, many of whom live on SS alone, needing to maintain that check in order to live. On the other hand, the Medicare fund is seriously underfunded. By allowing hundreds of thousands of SS recipients not pay their full share, it only makes this worse. It's a conundrum for sure.

If it weren't for the hold harmless provision, the ever increasing Medicare B premium would eventually eat away at the already low SS income for the poorest among us who can least afford it.

.

 

[Perryinva]

I suppose theoretically the lower SS recipients could never see a COLA increase if Medicare increases always outstrip the COLA amounts, right?

 

[Helena]

I suppose theoretically the lower SS recipients could never see a COLA increase if Medicare increases always outstrip the COLA amounts, right?

That hasn't happened... yet.

But insurance premium [not just Medicare B] increases are now outpacing almost everthing else.

.

 

[Momcpa]

New to this 'Social Security thing'......so please bear with me.......
1. Does the increase (if given) only apply to the amount you receive if your ARE ALREADY receiving benefits? Or does it also include an increase to the amount you WILL get if you have delayed receiving benefits?

2. If someone is receiving spousal benefits (50% of their spouses amount), will they be getting a portion of the percentage of increase also? Or does it not apply in any way to spousal benefits?

Thanks from a new "member" of the Social Security crowd !!!!

 

[Independent]

I suppose theoretically the lower SS recipients could never see a COLA increase if Medicare increases always outstrip the COLA amounts, right?

Yes, theoretically. But, practically, that's unlikely over the long term.

Consider "low" retirees getting about $900/month. A 2% COLA adjustment adds $18 to their monthly checks. If they are paying $134 for Medicare part B, the Medicare premium would have to go up by 18/134 = 13% for the Medicare premium to absorb all their SS COLA adjustment.

Although a combination of 2% CPI increase and a 13% Medicare increase is possible, especially for one year, it seems to me that is an unlikely year-after-year situation.

It took about 13 years for the Medicare premium to double (from 2004 to 2017). This is an annual increase of less than 6%. During the same time period, the CPI-W grew at about 2% per year. Those number seem more likely looking forward to me.

OTOH, even though the 2%/6% situation allows for some SS COLA increase, it chews up a big chunk. Medical costs have gone up faster than average costs, and retirees spend a larger share of their incomes on medical bills. The hold harmless provision does very little to protect SS recipients from the long term effects of that.

 

[MissMolly]

New to this 'Social Security thing'......so please bear with me.......
1. Does the increase (if given) only apply to the amount you receive if your ARE ALREADY receiving benefits? Or does it also include an increase to the amount you WILL get if you have delayed receiving benefits? It will apply to any future amount you will get on your own benefits if you are delaying claiming those benefits.

2. If someone is receiving spousal benefits (50% of their spouses amount), will they be getting a portion of the percentage of increase also? Or does it not apply in any way to spousal benefits? All people receiving SS will receive the COLA increase if one is granted.

Thanks from a new "member" of the Social Security crowd !!!!

This is my understanding.

 

[Tadpole]

It just occurred to me that, by choosing a restricted application with spousal, I have delayed starting the full Medicare increase. So, hold harmless has been based on COLA increases on my small spousal benefit instead of the larger benefit. Had I taken my own benefit at full retirement I probably would have already been paying the full part B increase. As it is, I am still paying $10 less than full premium. I wonder if they will claw back the difference when I switch to my age 70 benefit or just leave the past as is and start over with part B premium amounts.

 

[Golden sunsets]

It just occurred to me that, by choosing a restricted application with spousal, I have delayed starting the full Medicare increase. So, hold harmless has been based on COLA increases on my small spousal benefit instead of the larger benefit. Had I taken my own benefit at full retirement I probably would have already been paying the full part B increase. As it is, I am still paying $10 less than full premium. I wonder if they will claw back the difference when I switch to my age 70 benefit or just leave the past as is and start over with part B premium amounts.

I have been on spousal for 3.5 years and am currently paying $9 less than the current premium. I switch to my own record this November which is more than triple my current spousal and assume that I will immediately pay the additional $9 per month plus whatever increase is in store for us in January.


Sent from my iPad using Early Retirement Forum

 

[rayvt]

Yes that is my point in that how valuable is the hold harmless aspect when deciding whether to take SS early, if it eventually gets caught up.

"Caught up" only means that you eventually will pay the full standard Medicare premium.

But there is no clawback. If you were held harmless and paid less than the standard premium for a year ot two, you *never* have to pay back that shortfall.

 

[Dtail]

"Caught up" only means that you eventually will pay the full standard Medicare premium.

But there is no clawback. If you were held harmless and paid less than the standard premium for a year ot two, you *never* have to pay back that shortfall.

Yes I am aware of that concept.
My point was more so that the value of being held harmless is perhaps not a major factor in a decision whether to delay or not.

 

[rayvt]

Google provides answers. It's not hard.

"he Medicare hold harmless provision stems from a statutory restriction preventing Medicare from raising most Social Security recipients’ Medicare Part B premiums by more than the cost of living adjustment (COLA) provided by Social Security in a given year. "

If you are having the Medicare premium deducted from your Social Security check, then your net SS check will not be reduced. Your Medicare premium will not increase more than the COLA increase.

The actual kicker is that the entire medicare increase for the entire population of Medicare recipients is distributed over all the people who pay the increase. If the increase was $10, but half the people were held harmless to $0 increase, then the people who weren't held harmless have to pay $20.

Unless Congress quickly passes an ad-hoc law that caps that increase. Which they did a couple of years ago. COLA was 0%, Medicare went up a lot, but 90% of the people were protected by hold harmless, so the people that weren't would have gotten a huge increase of their Medicare premium. 10% of the people would have had to pay 100% of the increase.

 

[Dtail]

Google provides answers. It's not hard.

"he Medicare hold harmless provision stems from a statutory restriction preventing Medicare from raising most Social Security recipients’ Medicare Part B premiums by more than the cost of living adjustment (COLA) provided by Social Security in a given year. "

If you are having the Medicare premium deducted from your Social Security check, then your net SS check will not be reduced. Your Medicare premium will not increase more than the COLA increase.

The actual kicker is that the entire medicare increase for the entire population of Medicare recipients is distributed over all the people who pay the increase. If the increase was $10, but half the people were held harmless to $0 increase, then the people who weren't held harmless have to pay $20.

Unless Congress quickly passes an ad-hoc law that caps that increase. Which they did a couple of years ago. COLA was 0%, Medicare went up a lot, but 90% of the people were protected by hold harmless, so the people that weren't would have gotten a huge increase of their Medicare premium. 10% of the people would have had to pay 100% of the increase.

Let me state again. I UNDERSTAND the whole process and concept.
I was just stating that there are many factors which go into when to take SS.
The hold harmless factor is another factor mentioned.
However, I don't think this point is a major factor in the decision process.
That's it........