The Social Security Administration on Thursday issued a historic 8.7% cost-of-living increase, giving prospective senior living residents improved buying power in the coming year. But the increase is getting mixed reviews from advocates for older adults, and one senior living association says that more needs to be done to help older adults meet their housing, food and care needs.
The Social Security and Supplemental Security Income benefits for approximately 70 million Americans will increase by more than $140 per month beginning in January.
The increase, the highest in four decades, comes after an announcement last month by the Centers for Medicare & Medicaid Services that Medicare Part B premiums will decrease next year for the first time in more than a decade, saving more than $60 annually per beneficiary.
In addition, several provisions in the Inflation Reduction Act will go into effect in January, lowering prescription drug prices for older adults.
The combined changes are expected to boost the budgets of one in five American households, according to the House Democratic Caucus Task Force on Aging & Families.
AARP CEO Jo Ann Jenkins said the adjustment will provide “much needed relief” to millions of Americans.
“The guaranteed benefits provided by Social Security, including the annual COLA, are more crucial than ever as high inflation remains a problem for older Americans,” Jenkins said in a statement. “The automatic adjustment is an essential part of Social Security that helps ensure the benefit does not erode over time due to rising prices.”
AARP, Jenkins added, continues to urge Congress to protect and strengthen Social Security for the long term.
Although applauding the adjustment, Argentum said more needs to be done to help older adults meet their housing, food and care needs.
“As our aging population rapidly increases, it’s important for federal and state policymakers to look to cost-effective care for seniors that better protects safety net programs,” an Argentum spokesman told McKnight’s Senior Living. “Assisted living, memory care and independent living communities comprehensively care for seniors and safe state and federal dollars. Lawmakers must look to making these communities accessible and affordable.”
The National Council on Aging said the adjustment is “inadequate” for older adults facing “skyrocketing housing and healthcare costs.” NCOA noted that older adults were the only group to see an increase in poverty rates, as reported by the US Census Bureau.
“We now have almost 6 million older adults who cannot age with dignity,” NCOA President and CEO Ramsey Alwin said in a statement. “This is a clear indication that our nation’s support programs are not meeting today’s realities.”
The Social Security Act ties the annual cost-of-living adjustment to the increase in the Consumer Price Index, as determined by the Department of Labor’s Bureau of Labor Statistics. Alwin noted that one in four individuals receiving Social Security depend on it for 90% of their income.
NCOA suggested the Elder Index as a more accurate measure of the needs of older adults. Developed by the Gerontology Institute at the University of Massachusetts Boston, the Elder Index includes the costs of housing, healthcare, transportation and food.
“We need a better measure of the true cost of living for older adults,” Alwin said. “It is the only adequacy measure that is designed specifically for older people.”
