December 8, 2022 by Ethan Gilbert
A big headline in recent weeks has been the 8.7% cost-of-living increase Seniors will be getting next year. That increase, the largest since 1982, will be very useful in offsetting the higher costs consumers are seeing. Luckily for seniors, the good news didn’t stop there.
Around the same time, it was announced that Medicare Part B premiums are dropping 3%. Medicare Part B premiums are determined each year by changes in spending on physician-administered drugs. The large increase in Social Security benefits coupled with the drop in Medicare Part B premiums may be a once in a lifetime event. The only other time Part B premiums declined was in 2012 (-13.4%), the same year Social Security increased 3.6%.
The following table shows the benefit for an average Social Security recipient after Part B premiums are deducted.
That 10% net gain for the average senior is large, quite a bit bigger than the net 5.5% they received in 2012. It’s not all good news as inflation continues to be high, but it’s nice to get a little help.