Social Security Confirms New Increase in SSDI Checks – It’s Official

As Social Security Disability Insurance (SSDI) beneficiaries anticipate their 2025 checks, many are wondering how much extra income they’ll receive. Though the official Social Security cost-of-living adjustment (COLA) won’t be confirmed until October 2024, preliminary estimates indicate a modest increase.

According to the Senior Citizens League (TSCL), a 2.5% increase in SSDI payments is expected for 2025. This prediction is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), the metric used to determine the COLA.

Increase

If the predicted 2.5% COLA holds, SSDI beneficiaries will notice the increase in their checks starting in January 2025. While the bump isn’t as large as the 8.7% increase in 2023, it aligns with the historical average of 2.6% over the past 20 years. For example, if a retiree is currently receiving the average monthly Social Security benefit of $1,920.48, the 2.5% increase would raise their monthly payment to $1,968.49, an increase of $48.01.

Although this year’s anticipated increase won’t match the hefty COLA from previous years driven by high inflation, it still helps SSDI recipients keep up with rising living costs. However, this increase may be somewhat offset by other factors, such as Medicare premium hikes.

Impact

For SSDI beneficiaries, the increase in their checks may be reduced by rising Medicare premiums. In 2025, Medicare Part B premiums are expected to increase by around $10.30 per month. Since many SSDI beneficiaries have their Medicare premiums deducted directly from their benefits, this will reduce the actual amount they receive. For example, someone who sees a $48.01 increase in SSDI might end up with only around $37.71 extra after their Medicare premium adjustment.

Despite this, the COLA increase still provides some financial relief, especially as inflation cools, making these modest increases closer to the long-term trend.

Calculating

Once the official COLA is announced, it will be easier to calculate exactly how much your SSDI checks will go up. If the 2.5% increase holds and you’re currently receiving $2,000 per month in benefits, you can expect an additional $50 per month starting in January 2025. Keep in mind that individual factors, like your full retirement age and changes to Medicare premiums, could slightly alter this estimate.

It’s always a good idea to monitor upcoming announcements from both Social Security and Medicare to stay informed about how these changes will impact your financial situation. The official Medicare premium rates for 2025 will be revealed before the final COLA numbers are confirmed, so it’s worth keeping an eye on those developments to get a clearer picture of what you can expect.

Medicare

In addition to SSDI increases, there’s another major issue facing millions of Social Security and Medicare beneficiaries. More than 500,000 Medicare Advantage customers will lose coverage in 2025 due to insurer Humana pulling out of 13 markets nationwide. This decision comes after the Centers for Medicare and Medicaid Services reduced its Medicare Advantage benchmark rate, which caused reduced earnings for insurers.

Humana’s exit will affect roughly 10% of its Medicare Advantage members, forcing them to find new coverage options. Many of those impacted will have alternative plans to choose from, but it could create significant challenges for people used to the benefits and costs of their previous plans.

Humana

Humana’s decision to leave these markets stems from several factors, including the financial hit caused by Medicare Advantage’s benchmark rate cut and increased utilization of supplemental benefits. Humana anticipates that the revisions made to Medicare Advantage benefits for 2025 will drive even higher consumption of perks like over-the-counter cards and dental services in late 2024.

As beneficiaries become more aware of these changes, Humana expects them to use these supplemental services at a higher rate. Unfortunately, this has prompted the company to exit less profitable markets, leaving many seniors scrambling to find new plans.

Changes

For SSDI beneficiaries, the upcoming year brings both positives and negatives. The expected 2.5% increase in SSDI checks provides some relief, but rising Medicare premiums and the shake-up in Medicare Advantage plans could offset that boost.

Staying informed about these changes is key to managing your financial outlook in 2025. Keep an eye on updates from Social Security and Medicare to know how your benefits will change and what actions you may need to take.

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