Medicare Premium Hike of $17.90 Impacts Social Security Benefits

Retirees in the United States are facing a significant adjustment in their finances as the monthly premium for Medicare Part B will increase by $17.90 to $202.90 starting in January 2026. This hike is set to cut into the cost-of-living adjustment (COLA) for Social Security beneficiaries, who will see an increase of approximately $56 monthly due to inflation.

In late October, Social Security recipients received news of the inflation-adjusted hike, which translates to an annual boost of $672 for those receiving average retirement benefits of around $2,008 per month. However, the November announcement of the Medicare premium increase has left many retirees with less than anticipated. For some, the actual increase in Social Security payments could drop to approximately $38 a month after accounting for the Medicare premium.

The Centers for Medicare and Medicaid Services (CMS) released details about the upcoming premium hike via an online fact sheet on November 14, 2025. This increase marks the second highest in the program’s history, following a previous increase of $21.60 in 2022. Early projections had suggested an even larger premium of $206.50 for 2026, which would have represented a total increase of $21.50.

Medicare Part B covers various essential healthcare services, including physician services and outpatient hospital care. For some lower-income households, the increase in the Medicare premium may exceed the dollar amount of their Social Security benefit increase, effectively erasing any financial gain.

The COLA adjustment is not a flat amount; it is a percentage of monthly benefits, which for 2026 will stand at 2.8%. This means individuals receiving lower amounts, such as $600 per month, will see a smaller increase of $16.80, which does not cover the new Medicare premium hike.

Mary Johnson, an independent Social Security and Medicare policy analyst, noted that the substantial increase in Part B premiums could trigger the “hold harmless” provision. This provision protects beneficiaries with a Social Security benefit of $640 or less from losing their entire COLA to rising Medicare costs. As a result, some individuals may experience little to no increase in their Part B premium, allowing their Social Security benefit checks to remain stable.

Shannon Benton, executive director of the Senior Citizens League, emphasized that under the hold harmless provision, the increase in Medicare Part B premiums is limited to the dollar amount of a recipient’s COLA. This safeguard is crucial for individuals who have other automatic deductions, such as Medicare Advantage or Part D premiums, which could further reduce their Social Security payments.

Higher-income beneficiaries face additional costs, as Medicare Part B premiums are calculated based on income levels. Starting in 2026, those with an adjusted gross income exceeding $109,000 for singles and $218,000 for couples will pay more than the standard premium. For example, a joint filer with an income above $274,000 may incur a premium of $405.80 for full Part B coverage.

The changes in Medicare and Social Security highlight the complex interplay between healthcare costs and retirement benefits, impacting the financial stability of millions of retirees across the United States. As these adjustments take effect in January 2026, many recipients will need to reassess their budgets to accommodate the rising healthcare costs.