Photograph Source: US Government – Public Domain
Almost a year ago, I wrote a CounterPunch article on how the social security cost of living increase was eroded by higher charges for Medicare coverage. That is again happening in 2026 as reported in a recent New York Times news story that deserves widespread coverage.
The 2026 social security Cost of Living Adjustment (COLA) is 2.8% which provides those receiving the most money from social security with more money compared to those receiving less. According to the Times report, the 2025 monthly social security payment provided to the average retired worker is $2,008/month. With the COLA, this retired worker will be receiving $2,064/month in 2026, $56 more.
However, the 2.8% COLA is accompanied by a 9.7% increase of $17.90 in the Medicare deduction to $202.90 that is taken from one’s social security payment and, essentially, reduces the average retired worker’s social security COLA of $56 to $38.10, which can be viewed as making the actual social security COLA 1.9%. If in 2025, one receives even less than the average recipient, for example, $1,500/month, their COLA increase is reduced because of the Medicare deduction to 1.6%.
Many people have Medicare Advantage plans which, according to the New York Times article, costs the government $80 billion more each year than were people, instead, “enrolled in traditional Medicare.” The monthly charges for these plans may have gone up as well. For example, the Kaiser Medicare advantage plans for those who live in Alameda county in California in 2026 are increasing anywhere from $19 to $29/month. If one is enrolled in the basic Kaiser plan, the monthly charge will increase from $0/month in 2025 to $19/month in 2026. Deducting the $19/month and the higher Medicare amount of $17.90 renders the value of the average retiree social security COLA to $19.10/month, or to less than 1%, obviously far below the increase in the cost of living in 2025.
Additionally, this Kaiser basic plan has increased some of the costs for services. For example, a hospital stay will be $290/day for the first five days in 2026 compared to $260/day in 2025. If one needs to use an ambulance, the charge will be $350 in 2026 compared to $250 in 2025. These increased costs, if incurred, will further erode the value of the social security COLA, perhaps rendering it into being a negative COLA and undermining the recipient’s standard of living even more, especially if they receive less than the average monthly amount from social security.
One highly influential person who receives much media attention recently said that “we have the greatest economy right now.” On another occasion, he posted “Our Economy is BOOMING, and Costs are coming way down.”
However, people who rely heavily on social security payments and Medicare for getting by may feel compelled to express their disagreement with the great leader by claiming their economic conditions are getting worse as costs go up more rapidly than their income. In other words, they are getting screwed.
The post Increase in Social Security Payments Undercut by Greater Medicare Deduction appeared first on CounterPunch.org.
This content originally appeared on CounterPunch.org and was authored by Rick Baum.
Rick Baum | Radio Free (2025-12-02T06:50:53+00:00) Increase in Social Security Payments Undercut by Greater Medicare Deduction. Retrieved from https://www.radiofree.org/2025/12/02/increase-in-social-security-payments-undercut-by-greater-medicare-deduction/
Please log in to upload a file.
There are no updates yet.
Click the Upload button above to add an update.