Social Security Raise Due Wednesday, but Medicare Costs Will Claim a Share
For retirees who spend the weeks before each October counting on a raise, this year’s number is likely to be better than the last. What many will find, though, is that a piece of it is spoken for before it arrives.
The Social Security Administration is scheduled to announce its 2027 cost-of-living adjustment at 8:30 a.m. Eastern on Wednesday. Federal statisticians release the September consumer price report that morning, supplying the last figure the agency needs. The formula compares the average of a price index for urban wage earners and clerical workers over July, August and September with the same three months a year earlier. cronista
Outside projections run from 3.2 percent to 3.6 percent, with advocacy groups clustering near 3.5 percent. That would top the 2.8 percent adjustment for 2026. Inflation over the 12 months through July stood at 3.4 percent, which helps explain the higher forecasts. The estimates remain unofficial, and the September data could nudge them either way.
The adjustment reaches recipients of retirement, disability and survivor benefits, along with Supplemental Security Income. The 2026 raise went to roughly 75 million people.
The deduction
The complication is Medicare. Most enrollees 65 and older have their Part B premium, which pays for doctor visits and outpatient care, subtracted directly from their Social Security payments. When the premium goes up, the check shrinks.
The Medicare trustees’ annual report projects the premium will rise to $209.50 a month next year from $202.90, according to a summary by the Centers for Medicare & Medicaid Services’ trustees’ report as relayed by AARP. The annual deductible is projected to climb from $283 to $292. The projected percentage increase would be the smallest since 2023, and below last year’s report, which had put the 2027 premium at $218.60.
A rough illustration: a retiree collecting $1,500 a month would gain about $52 from a 3.5 percent adjustment. After the projected $6.60 premium increase, the net is closer to $46. The smaller the benefit, the larger the bite.
These premium numbers are estimates. AARP noted that over the past decade the trustees’ Part B projections have proved accurate only three times, and the agency typically publishes the official amount in November.
Not everyone is affected the same way
That arithmetic describes a typical enrollee, not everyone. Some beneficiaries are covered by a “hold harmless” provision that can limit a premium increase when their Social Security raise is small. Higher earners may owe an income-related surcharge on top of the standard premium, and people who are new to Medicare, or who pay premiums directly rather than through their benefit, fall under different rules. Whether any of this applies depends on income, enrollment date and payment method, and individual outcomes may differ from the examples here.
The longer squeeze
Looking further out, the trustees see the two figures moving apart. The Medicare trustees expect Part B premiums to grow about 6 percent a year on average from 2026 through 2031, while the Social Security trustees project adjustments averaging about 2.4 percent a year from 2027 to 2031. Should that hold, health costs would take a larger share of each year’s increase.
What comes next
New benefit amounts begin with January payments. The Social Security Administration sends individual notices in early December stating each person’s exact benefit. Before then, open enrollment for Medicare Advantage and Part D drug plans runs from Oct. 15 to Dec. 7, a window to compare coverage before the 2027 costs take effect.
Sources: Social Security Administration; Medicare Trustees Report (2026); AARP; Bureau of Labor Statistics.
