In the US, Social Security beneficiaries will see a 2.7% increase in their monthly benefits as a result of adjustments to the COLA by the SSA. These modifications were made in order to cope with the impact of the rising cost of living and inflation.

On the other side, an important consideration was taken regarding the scheduled cost of Medicare Part. Thus, analyst Mary Johnson argues that it is not surprising that Part B premiums would reduce the effort of the yearly COLA rise, which would rather neglect the rising cost of food or housing.
Low Income Retirees at Risk
According to the recent estimations based on the new inflation data, millions of beneficiaries under social security will receive an increase in benefits in 2026. These adjustments in COLA are more than the previous estimations of 2.5% which offer support to the retirees in coping with the increasing cost of living. The latest report reflects that prices cost of many things, such as food, housing, and other utilities, rose to 2.6% in June. As for the whole year, it is stated that the prices are up to a total of 2.7% which is slightly more than the rise seen in the month of May, which was 2.4%.

To keep the stability in the economy, the Federal Reserve wants prices to increase at most 2% annually, but it is not as they estimated because the prices are rising more than that. That is why the SSA is making adjustments on an annual basis, which is known as COLA, to ensure that retiree will receive an increase in their payments so they can continue buying the essential needs and do not face financial burden on themselves. However, that rise in the benefits will possibly not be felt as considerably because the scheduled premium of Medicare Part B will rise too.
New Medicare Part B premium with COLA Increase – Overview
Article On | Low Income Retirees at Risk – Upcoming Medicare Hike Could Offset COLA Benefit |
Country | United States |
Department | Social Security Administration |
Affected Beneficiaries | retired, widowed beneficiaries and spouses |
Estimated COLA for 2026 | 2.7% |
Category | Finance |
Official Website | ssa.gov |
The report reflecting the change in monthly costs
The reports that were released in June stated that the monthly cost will rise from $185 to $206.50 in 2026. That reflects $21.50 more each month, which is equivalent to an increase of 11.6%. It is specified that this increase would be the largest since the year 2022, when the Medicare premium rose by more than 14.5%.

The expert Mary Johnson, who is an Independent Social Security and Medicare policy analyst, warned that it is not uncommon for the Medicare Part B premiums to consume more or even all of the COLA increase annually, resulting the less money to cover the rising cost of essential things such as food and housing.
Who is particularly affected by the increase?
The increase particularly affected those beneficiaries who were getting lower social security benefits. Johnson stated that if in 2026 the COLA is 2.7% then an increase of $21.50 in the Medicare Part B premium would take all the increased benefits adjustments from those individuals who will about to receive $800 or less than that in a month.

In May, around 74 million individuals were getting their social security benefits with an average monthly payment of $1860.64. In this group, many people are included, such as the disabled, survivors, widowed, and beneficiaries of SSI. The calculation of final COLA is done by the SSA based on the average inflation rates from July to September, which is why the data from the upcoming years will be very crucial to confirming the increase.
The 2026 COLA increase would be diluted by the Medicare increase
The calculations help in estimating the increase in the upcoming years, which signifies a 2.7% rise in the social security benefits, which is higher than the previous 2.5%. However, according to the information released by USA Today, the rise could be diluted by the increase in Medicare medical premiums. It is stated that the current Medicare Part B premium, which is $185, will rise to $206.50 by the year 2026, which reflects an increase of $21.50 monthly or 11% more.

It is specified that this increase would be the largest since the year 2022, when the Medicare premium rose by more than 14.5%, so the estimated 2.7% increase in the cost-of-living adjustments would be automatically deducted for the beneficiaries under Medicare, and it would be reflected in their monthly benefit checks.
Final thoughts
According to the expert Mary Johnson, who is an Independent Social Security and Medicare policy analyst, lower-income beneficiaries who were receiving about $800 or less than that would see no change if there is a rise in COLA by 2.7% and Medicare Part B rises by $21.50. This increase also involved a group of individuals, such as retired, widowed beneficiaries and spouses, who are on average receiving a $860.64 a month benefit.
FAQs
Will the COLA increase be significant?
The projected 2.7% COLA for 2026 aims to offset inflation.
How does Medicare Part B affect it?
The estimated 11.6% rise in Part B premiums could significantly reduce the net increase retirees receive.
Who is most affected?
Retirees with lower Social Security benefits (around $800 or less) may see their entire COLA increase absorbed by the premium hike.
What was the Part B increase in 2022?
In 2022, the Part B premium increase was 14.5%.