How the 2024 Social Security COLA Will Affect Medicare

As the new year nears, Medicare beneficiaries are thinking about the 3.2% Social Security cost-of-living adjustment, or COLA, for 2024.

The agency that oversees Medicare, the Centers for Medicare and Medicaid Services, typically takes the Social Security COLA into account when it sets Medicare premiums, and that’s what happened this year.

It’s important to understand the upcoming changes when helping clients select plans.

The Question

What should Medicare beneficiaries expect regarding the impact of the 2024 Social Security COLA on Medicare premiums and benefits?

The Answer

Here’s what happened after CMS officials considered the Social Security COLA announcement and set the 2024 premiums, deductibles and other parameters for four major Medicare programs.

Medicare Part A

In 2024, beneficiaries of the Medicare Part A inpatient hospitalization insurance program will see a modest increase in the inpatient hospital deductible. The deductible will increase to $1,632, from $1,600 the previous year.

Most Medicare enrollees have paid enough payroll taxes to get Medicare Part A coverage without paying a premium. Only about 1% of Medicare Part A enrollees have to pay any premiums for the coverage.

If a client and the client’s spouse have 30 to 39 quarters of Medicare-covered employment, the 2024 premium will be $278, the same as in 2024.

If a client and the client’s spouse have less than 30 quarters of Medicare-covered employment, the premium will increased to $506, from $505 in 2024.

Medicare Part B

Clients with Medicare Part B physician and outpatient hospital services coverage will see their monthly premiums rise to $174.70, up from $164.90.

The annual deductible will increase to $240, from $226.