Tag Archives for SSA

Social Security 2025 COLA expected to be small increase 

Published in RINewsToday on September 16, 2024

Stay tuned… Next year’s cost-of-living adjustment (COLA) will be announced by the Social Security Administration (SSA) in mid-October, upon the release of September’s annual inflation adjustment data.  SSA’s COLA for 2025 will be reflected in beneficiary checks starting in January of that year. Like clockwork, this happens annually, although beneficiaries may see their payments occasionally arrive a few days early due to holidays or weekends. 

The Senior Citizen’s League (TSCL) releases its COLA projections each month. The official COLA is determined by the Labor Bureau’s revised CPI-W data from July, August and September.

Some say SSA’s 2025 COLA is “Chump Change”

With one month left, TSCL’s latest COLA model results, released on Sept. 11, 2024, predicts that next year’s COLA will be 2.5 % based on a decline from 2.9% to 2.5% in consumer price data. While 2.5% is lower than the 3.2% received in 2024, that wouldn’t be far from the historical norm. The COLA has averaged about 2.6% over the past 20 years. It went as low as 0.0% in 2010, 2011, and 2016 and as high as 8.7% in 2023.

According to TSCL, by law, the annual inflation adjustment is based on the average inflation during July, August, and September as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The Bureau of Labor Statistics averages the CPI-W for these three months and then compares it with the same timeframe from the previous year, says the Alexandria-based nonprofit advocacy group whose mission is to protect Social Security, Medicare, and veteran or military retiree benefits.  

TSCL’s COLA latest analysis findings indicates that next year’s COLA of 2.5% would raise the average monthly benefit for retired workers of $1,920 by $48 or about $564 annually. The modest increase will not enable seniors to cover increasing cost of living expenses (including food, clothing, transportation, energy, and shelter costs).  “Rising grocery prices is creating food insecurity for many retirees. Feeding America estimated that 5.5 million Americans age 60 and above suffered from food insecurity in 2021, in the most recent study available on the subject, and that number is likely higher today,” note the researchers.

“Due to a higher cost of living, older Americans are using more and more of their income each month just to get by compared to a year ago. “Sixty-five percent of seniors reported monthly expenses of at least $2,000, up from 55% in 2023,” says TSCL’s COLA analysis, noting that statistical testing shows that there’s almost no chance that this gap is due to noisy survey variation. (The 2024 survey had 2,129 respondents; 2023 had 2,258 respondents.)

But low-income seniors aren’t the only ones who have seen their expenses rise, either, say the researchers, noting that more seniors are spending at least $4,000 or $6,000 per month compared to 2023, too, while fewer are able to get by on $1,000 or less. TSCL says that a rise in monthly expenses wouldn’t be much of an issue if seniors’ higher expenses were going to fun activities things, like activities with their grandchildren, or discretionary costs, like bucket-list vacations. However, this is not the case, says the Social Security advocacy group.  “Nearly 80% of senior households in the 2024 survey reported that their monthly budget for essential items like food, housing, and prescription drugs had increased over the last 12 months, with 63% saying they’re worried that their income won’t be enough to cover these basic costs in the coming months,” says the analysis findings.

Over the years, TSCL, along with other aging advocacy groups including the National Committee to Protect Social Security (NCPSSM) and Social Security Works, have called for higher COLAs.

Calls for Congress to change current COLA formula.

Last March, in correspondence to Sen. Bob Casey, Jr. (D-PA), chairman of the U.S. Senate Special Committee on Aging, NCPSSM, the Washington DC based Social Security advocacy group endorsed Casey’s legislative proposal, S. 3974, entitled the “Boosting Benefits and COLAs for Seniors Act.”  The proposal has been referred to the Senate Finance Committee.

Specifically, Casey’s legislative proposal, introduced March 19, 2024, would direct SSA to adjust benefits based on CPI-E rather than CPI-W, if CPI-E would result in a larger increase in benefits. The Bureau of Labor Statistics  (BLS) would calculate and publish the CPI-E on a monthly basis. The Senator believes it would be the most accurate measure of the real effect of inflation on the goods and services that are purchased by America’s seniors.

In NCPSSM’s correspondence, CEO and President Max Richtman strongly supported Casey’s call for requiring BLS to change the way it calculates SSA’s annual COLAs, using a CPI-E formula.

According to Richtman, SSA’s current formula for calculating COLAs is based upon the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which is a measurement by the BLS of the changes in the prices paid for a market basket of goods and services purchased by urban wage earners and clerical workers.

“The current CPI-W has fallen far short of providing needed inflation protection because it fails to adequately measure the spending patterns of seniors,” says Richtman in his endorsement of Seniors typically spend more on out-of-pocket health care costs than other Americans, and in most years, the cost of health care rises more quickly than general inflation,” he says. “We believe adoption of your bill would go a long way toward protecting those on fixed incomes from the ravages of inflation,” says Richtman.

The following organizations have endorsed S. 3974: Arc of the United States; Alliance for Retired Americans; American Federation of Government Employees; American Federation of State, County and Municipal Employees; California Alliance for Retired Americans; Justice in Aging; National Committee to Preserve Social Security and Medicare; National Education Association; National Organization of Social Security Claimants Representatives; Social Security Works; Strengthen Social Security Coalition.

While former President Donald Trump and Vice-President Kamala Harris have both pledged to protect Social Security, nether have put out a specific plan to keep America’s retirement program solvent.

According to the last Social Security Trustees report, the Social Security Old-Age and Survivors Insurance  trust fund is projected to be depleted by 2033 at which point SSA will be forced to make a 21 percent across the board reduction.  The nonpartisan Committee for a Responsible Federal Budget estimates that this would be a $16, 500 cut in annual benefits for a typical dual-income couple retiring at the time of trust fund depletion. 

When the dust settles after the upcoming presidential election, the new president must make it a priority to hammer out a bipartisan fix along with pushing for requiring BLS to use the CPI-E Formula to accurately predict the impact of inflation on America’s retirees. 

Social Security changes expand access to SSI

Published in RINewsToday on May 20, 2024

Last week, the Social Security Administration (SSA) announced good news for Supplemental Security recipients.  The federal agency published a final rule on April 19, 2024, to – “Expand the Definition of a Public Assistance Household.” The regulation announces one of several updates to Supplemental Security Income (SSI) regulations that will help people receiving and applying for SSI.  

SSA continuously examines programmatic policy and makes regulatory and sub-regulatory changes as appropriate. SSI is a means-tested program providing monthly payments to adults and children with a disability or blindness, and to adults aged 65 and older. These benefits help pay for basic needs like rent, food, clothing, and medicine. People applying for and receiving SSI must meet eligibility requirements, including income and resource limits.

According to SSA’s Office of the Chief Actuary, once this rule is implemented and the effects have stabilized, in fiscal year 2033 its estimated that roughly 277,000 federal SSI recipients (4 percent of all SSI recipients) will have an increase in monthly payments compared to current rules, and an additional 109,000 individuals (1% increase) will receive Federal SSI payments who would not have been eligible under current rules.  As of December, 2022, there were approximately 30,500 people in Rhode Island receiving SSI benefits. 

SSA expands access to SSI program

Under SSA’s final rule (20 CFR Part 416), beginning September 30, 2024, the agency will expand the definition of a public assistance household to include households receiving Supplemental Nutrition Assistance Program (SNAP) payments and households where not all members receive public assistance. The expanded definition will allow more people to qualify for SSI, and increase some SSI recipients’ payment amounts. It also reduces reporting burdens for individuals living in public assistance households.

The SSA revised rule also changes the definition of a public assistance household when determining who in a household receives public assistance. The new rule defines a public assistance household as one that has both an SSI applicant or recipient, and at least one other household member who receives one or more of the listed means-tested public income-maintenance (PIM) payments (the any other definition).

The previous policy required all household members to receive public assistance. This change benefits SSI recipients living in households where only some members receive public assistance.

“I’m committed to making systemic changes to help people access the critical benefits they need, including SSI,” said Martin O’Malley, Commissioner of Social Security, in a May 9, 2024 statement announcing the release of the final rule. “By simplifying our policies and including an additional program geared towards low-income families, such as [those receiving] SNAP, we are removing significant barriers to accessing SSI. These changes promote greater equity in our programs.”

SNAP is the first PIM benefit added to the agency’s public assistance household definition since it was established in 1980. This change helps ensure the agency’s policies better represent the current landscape of means-tested programs in the United States, according to SSA.

These changes are key because if an applicant or recipient is determined to be living in a public assistance household, the agency assumes they are not receiving assistance from other household members that would otherwise be counted as income. This will allow more people to qualify for SSI and in some cases, receive a higher SSI payment.

Thumbs Up from aging network

“I commend the Biden administration for this needed expansion of the SSI program.  It is a recognition that those in the greatest economic need in our nation need help.  By expanding the definition of a public assistance household, it will not only allow more people to qualify for SSI but can also increase some existing SSI recipient’s payment amounts,” says Robert B. Blancato, Executive Director of the Washington, DC-based National Association of Nutrition and Aging Services Program, noting that programs such as SSI and SNAP are safety net programs for those who are truly [in need].  

“It is disingenuous to lose qualification for one safety net program because of being eligible for another.  The role of the federal government is to assist those most in need while minimizing bureaucratic red tape.  This final rule shows a level of compassion we need to see more of in federal policy,” adds Blancato.

According to Maria Freese, Senior Legislative Representative at the Washington, DC-based National Committee to Preserve Social Security and Medicare, this new rule will take an important step toward simplifying some of the most complicated and burdensome rules governing the SSI program. SSI’s in-kind support and maintenance (ISM) rules reduce benefits dollar-for-dollar for the value of support from family or friends, such as a place to sleep, or help with groceries, up to one-third of benefits. SSI is the only federal program to reduce benefits in this manner. “While fewer than 1 in 10 SSI beneficiaries receive ISM, the current ISM rules make the program more complicated for nearly every SSI beneficiary.  SSA is required to ask detailed, personal, and complicated questions concerning living arrangements, other household members and budgeting, not only once but repeatedly as family circumstances change,” she says.

Freese added: “Groups living together who qualify as ‘public assistance households’ are exempt from these reporting requirements, but the previous definition, which required that every member of the household receive public assistance, limited the ability of low-income beneficiaries to take advantage of the exemption.  The new rule requires only one SSI beneficiary and one additional member of the household be a recipient of public assistance, and expands the qualifying programs to include the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps).” 

“This new rule will lessen hardship for struggling, low-income families, simplify the administration of the SSI program and lower costs and staff time for the Social Security Administration, which has been chronically underfunded.  It represents good public policy, and reflects well on an agency working hard to provide the benefits working families deserve,” notes Freese.

According to Nancy Altman, President and CEO of the Washington, DC-based Social Security Works, this rule is an important step towards improving the Supplemental Security Income program (“SSI”). “Currently, SSI forces the most disadvantaged Americans to jump through numerous time-consuming, complicated, and burdensome hoops simply to get below-poverty level benefits. Simplifying the numerous burdensome requirements will not only ease the lives of those whom government is intended to serve, it will also reduce administrative costs,” she says. 

“Ultimately, Congress needs to act to improve SSI, as well as adequately fund the SSA so it can hire and train enough staff to properly administer the program. In the absence of action from Congress, the Biden administration is doing what it can on its own, including this and other rule changes, says Altman.

Altman suggests that if Congress and the Social Security Administration truly want to save administrative costs and provide more accurate and timely payment amounts, more rules like these should be adopted and the laws governing SSI should be updated and simplified.” 

With Social Security’s long-term purchasing power dwindling and heightening financial uncertainty for recipients, the League supports updating the definition of public assistance for beneficiaries receiving SSI, says Shannon Benton, Executive Director of the Alexandria, Virginia-based Senior Citizens League. “’The increased inability of seniors to make ends meet remains a pressing concern of The Senior Citizens League, and it should also be a pressing concern of Congress,” she says.

Adds Associate Director Kathleen Holt, of the Connecticut-based Center for Medicare Advocacy, “The expanded definition of ‘public assistance household’ is a thoughtful, focused way to ensure the dignity and needs of individuals in a residence are upheld.”

For more information on the SSI program, including who is eligible and how to apply, visit https://www.ssa.gov/ssi.

To read the final rule “Expand the Definition of a Public Assistance Household,” visit  https://www.federalregister.gov/documents/2024/04/19/2024-08364/expand-the-definition-of-a-public-assistance-household.

For further details about the final rule, contact Tamara Levingston, Office of Income Security Programs, 6401 Security Blvd., Robert M. Ball Building, Suite 2512B, Woodlawn, MD 21235, 410-966-7384.

Modest Social Security COLA increase seen as chump change by some

Published in RINewsToday on October 16, 2023

Last week, the Social Security Administration (SSA) announced that Social Security and Supplemental Security Income (SSI) benefits for more than 71 million beneficiaries will increase 3.2% in 2024, about $59 per month starting in January. The 2024 payment declined from last year’s 8.7%, but that had been the highest in four decades. And, its higher than the average 2.6% increase recorded over the past 20 years.

The Social Security Act determined how the cost-of-living adjustment (COLA) is calculated. Enacted on August 14, 1935, the Act ties the annual COLA to the increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) as determined by the Department of Labor’s Bureau of Labor Statistics.

More than 66 million Social Security beneficiaries will see that COLA increase 3.2% beginning in January 2024, and increased payments to approximately 7.5 million people receiving SSI will begin on December 29, 2023. (Note: some people receive both Social Security and SSI benefits).  

“Social Security and SSI benefits will increase in 2024, and this will help millions of people keep up with expenses,” observes Kilolo Kijakazi, Acting Commissioner of Social Security in an Oct. 12 statement announcing this year’s COLA increase.

According to SSA, some other adjustments that will also 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 $168,600 from $160,200.

Advocacy groups on aging talk turkey about COLA

“The annual COLA is a reminder of Social Security’s unique importance. Unlike private-sector pension plans, whose benefits erode over time, Social Security is designed to keep up with rising prices, noted Nancy Altman, President of the Washington, DC-based Social Security Works (SSW), in response to SSA’s COLA announcement.  

“Retirees can rest a little easier at night knowing they will soon receive an increase in their Social Security checks to help them keep up with rising prices,” said Jo Ann Jenkins, AARP chief executive. “We know older Americans are still feeling the sting when they buy groceries and gas, making every dollar important,” she added, stressing that Social Security has been the foundation for financial security for hundreds of millions of retirees. “SSA’s COLA announcement shows that it’s continuing to deliver on this promise,” she says.  

However, Max Richtman, President and CEO, National Committee to Preserve Social Security and Medicare charges, “While we are grateful that Social Security is the only major retirement program with a built-in cost-of-living adjustment, the current formula for determining COLAs is inherently flawed. SSA’s current COLA formula doesn’t truly reflect the increase in prices for the goods and services that beneficiaries rely on.”

According to Richtman, the 3.2% 2024 COLA only represents a modest $59 increase in the average monthly benefit for retired workers, and that’s before deducting the projected increase in the 2024 Medicare Part B premium of about $10 per month. Because of this the average retirement beneficiary will receive a net COLA of about $50. 

Richtman notes, “That is not enough for a tank of gas or half a week’s worth of groceries in many states. The net COLA will barely cover one brand-name prescription co-pay for some patients.”  

Last year, Richtman noted that the COLA of 8.7% was unusually high, the highest in some 40 years. But post-pandemic inflation was also at record highs, he said, noting that historically, COLA’s have been relatively low. In fact, the COLA has been ZERO; three times since 2009.  

“Seniors deserve an accurate COLA formula that accounts for the impact of inflation on their living costs. That is supposed to be the entire purpose of a COLA. The current formula measures the impact of inflation on urban wage earners and clerical workers. How is that a reasonable formula for seniors? Seniors have different spending patterns than urban wage earners & clerical workers,” asks Richtman.  

Richtman notes that seniors spend more than other age group on expenses like housing, long-term care, and medical services. “We strongly favor the adoption of the CPI-E (Consumer Price for the Elderly) for calculating COLAs. The CPI-E would more accurately reflect the impact of inflation on the goods and services seniors need, he believes. 

The CPI-E is included in both major pieces of legislation to expand and protect Social Security that have been introduced in this Congress: Bernie Sanders’ Social Security Expansion Act and Rep. John Larson’s Social Security 2100 Act.  We have endorsed both of those bills as part of our commitment to boosting Social Security for current and future retirees. It’s past time for Congress to act,” says Richtman. 

Although the 3.2% COLA is well above the 2.6% average over the past 20 years, a newly released retirement survey released on Oct. 12, 2023, by The Senior Citizens League (TSCL) indicates that seniors are pessimistic about their financial well-being in the upcoming months and very concerned about growing calls on Capitol Hill for Social Security cuts. Sixty-eight percent of survey participants report that their household expenses remain at least 10 percent higher than one year ago, although the overall inflation rate has slowed. This situation has persisted over the past 12 months.

According to TSCL’s latest retirement survey, worry that retirement income won’t be enough to cover the cost of essentials in the coming months is a top concern of 56 percent of survey respondents. Social Security benefit cuts are an even bigger concern, ranked as the number one worry by nearly 6 out of 10 survey participants, or 59%. Over the past year, benefit cuts and trims have affected a large percentage of older Americans low-income households, individuals who can least afford them.

A year ago, TSCL warned that higher incomes due to the 5.9% and 8.7% COLAs in 2022 and 2023 could potentially affect eligibility for low-income assistance programs such as SNAP and rental assistance. Earlier this year, federal emergency COVID assistance for SNAP (food stamps) and Medicaid also ended. Surveys conducted in 2022 and this year suggest that significant numbers of lower-income older households have lost access to some safety net programs over the past 12 months, the survey finds.

A Final Note…

Social Security plans to start notifying beneficiaries about their new COLA amount by mail starting in early December. Individuals who have a personal “my Social Security account” can view their COLA notice online, which is secure, easy, and faster than receiving a letter in the mail. People can set up text or email alerts when there is a new message–such as their COLA notice—instead of waiting for them in my Social Security.

People will need to have a “my Social Security account” by November 14 to see their COLA notice online. To get started, visit www.ssa.gov/myaccount.

Information about Medicare changes for 2024 will be available at www.medicare.gov. For Social Security beneficiaries enrolled in Medicare, their new 2024 benefit amount will be available in December through the mailed COLA notice and my Social Security’s Message Center.

For details about SSA’s 2024 Changes, go to: https://www.ssa.gov/news/press/factsheets/colafacts2024.pdf.