Rising Medicare premiums and no cost-of-living adjustment can reduce Social Security payments

The combination of rising Medicare premiums and no annual cost-of-living adjustment (COLA) would reduce Social Security payments for about 23 million of the nation's seniors in 2011, according to The Senior Citizens League. This figure represents two-thirds of the 37 million seniors who receive Social Security benefits.

The estimate is based on the group's recent survey of more than 2,400 seniors. Half of them said they received lower Social Security benefits after Medicare premium deductions this year, due to the lack of a COLA for the first time in 35 years. The same situation is expected next year, because the Social Security Trustees and Congressional Budget Office have predicted that inflation will again remain too low to pay a COLA. Medicare premiums, on the other hand, are expected to increase.

"Another year of no COLA will put Social Security benefits through the wringer," said Larry Hyland, chairman of The Senior Citizens League. "After paying their Medicare health insurance premiums, seniors will have even less to spend on other essentials. This will force many of them to fall below the poverty line."

Forty-seven percent of those surveyed said their annual Social Security benefits were reduced by at least $132 in 2010; about ten percent reported that their benefits dropped by more than $840.

"Seniors need a more fair and adequate COLA, to help them offset the inevitable health-care cost increases," Hyland said.

The Senior Citizens League strongly supports legislation that would provide an emergency COLA or guarantee a minimum average COLA to prevent the erosion in Social Security benefits.