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SOCIAL SECURITY Q AND A: Is cost-of-living adjustment automatic?

Q. Is it true that there is no 2010 cost-of-living adjustment increase for Social Security? If so, why not? A. Neither Social Security nor Supplemental Security Income have a cost-of-living increase for 2010. By law, there is a yearly cost-of-liv...

Q. Is it true that there is no 2010 cost-of-living adjustment increase for Social Security? If so, why not?

A. Neither Social Security nor Supplemental Security Income have a cost-of-living increase for 2010. By law, there is a yearly cost-of-living adjustment only if there is an increase in the Bureau of Labor Statistics' Consumer Price Index for Urban Wage Earners and Clerical Workers from the third quarter of the last year to the third quarter of the current year. There was no increase in the index from the third quarter of 2008 to the third quarter of 2009, so there is no 2010 increase. To learn more, visit www.socialsecurity.gov/cola .

Q. Will the Medicare Part B premium increase lower my Social Security in 2010?

A. Not for most people. As announced by the Center for Medicare and Medicaid Services, the basic Medicare Part B monthly premium increased from $96.40 in 2009 to $110.50 in 2010 but most people already receiving Social Security will not see this increase. In order to avoid reducing their net Social Security benefit, the law contains a "hold harmless" provision that protects about 93 percent of SSA beneficiaries from paying a higher Part B premium. People not protected include higher income beneficiaries subject to a higher income-adjusted Part B premium and people who will be newly entitled to Part B in 2010. No "hold harmless" provision exists for Medicare Parts C and D (prescription drug coverage) so people would pay any higher premiums for these.

Q. Why do some people pay a higher Medicare Part B premium than others?

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A. For many years, the government has paid a 75 percent subsidy of the Part B standard premium with the beneficiary paying the remaining 25 percent. In other words, for each person paying the basic Part B premium, which is $110.50 in 2010, the government pays three times that. The Medicare Modernization Act of 2003 changed this subsidy so, since 2007, people with higher income, as reported to the Internal Revenue Service, are paying a larger percentage of actual Part B premium costs with a higher monthly premium. This affects less than 5 percent of people with Medicare. See www.ssa.gov/pubs/10161 .

html for details.

General information questions can be sent to Howard I. Kossover, SSA, 402 DeMers Ave., Suite 300, Grand Forks ND 58201; phone (701) 772-5518 ext. 200; fax: (701) 772-8622; e-mail: howard.

kossover@ssa.gov . Please include the name of the paper in which you read the article. General information also is available on the agency Web site, www.socialsecurity.gov , or by calling the national toll-free number, (800) 772-1213.

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