In recent times, there's been a buzz around the potential financial changes for SSI recipients. With the cost of living continually rising, many are wondering if there will be a significant increase in their monthly benefits. Among the most discussed topics in this realm is the potential adjustment to the Supplemental Security Income (SSI) and the implications of the Cost of Living Adjustment (COLA) on Social Security benefits. It’s important to be aware of the potential changes and understand the broader picture.
So, will SSI get a $200 raise in 2023? This article sheds light on the current discussions, historical context, and potential future of these crucial financial support systems.
Supplemental Security Income (SSI) is a federal income supplement program funded by general tax revenues (not Social Security taxes). It is designed to help aged, blind, and disabled individuals who have little or no income. The program provides cash to meet basic needs for food, clothing, and shelter.
There have been discussions and articles suggesting that Social Security recipients might receive an extra $200 per month in 2023. A bill was reintroduced that proposed this increase. Under the terms of this bill, current Social Security recipients or those who turn 62 in 2023 would receive an extra $200 in each monthly check. However, it's essential to verify the final status of this bill and whether it has been passed or not.
Supplemental Security Income (SSI) is a vital program that has been in existence for several decades. It was established to ensure that the most vulnerable populations, such as the elderly, blind, and disabled, have a safety net to rely on for their basic needs.
SSI was signed into law in 1972 and began making payments in January 1974. Before SSI, assistance for the aged, blind, and disabled was provided by the individual states and territories. The federal government provided financial participation in the state programs. However, there were significant disparities in the assistance provided across states, leading to the establishment of SSI as a federal program to standardize assistance.
The Cost of Living Adjustment (COLA) is an annual adjustment to Social Security and SSI benefits to counteract the effects of inflation. The COLA ensures that the purchasing power of these benefits remains constant despite rising prices. In recent news, Social Security and SSI benefits for approximately 70 million Americans increased by 8.7 percent in 20232. This adjustment is significant and is one of the ways the government ensures that beneficiaries can cope with the rising cost of living.
SSI is a lifeline for many, but who exactly qualifies for these benefits? By understanding the demographics and criteria, we can better appreciate the potential impact of any changes to the program.
To be eligible for Supplemental Security Income (SSI), individuals must meet certain criteria:
Income Limitations: SSI is generally for individuals who don’t earn more than $1,913 from work each month. This income limit increases for couples and when parents apply for children. The Social Security Administration (SSA) also considers other sources of income besides employment, such as disability benefits, unemployment, and pensions.
Resource Limitations: Common resources that are considered include vehicles and money in bank accounts. The resource limit is set at $2,000 for individuals and $3,000 for couples. For parents applying for a child, these numbers increase by $2,000.
Age And Disability: If an individual is 64 years or younger, they must have a disability that affects their ability to work for a year or more, will result in death, or severely limits daily activity (for children with disabilities). Those who have a disability must also prove they’ve earned less than $1,470 from work per month in the month they’re applying. However, citizens aged 65 or older don’t need to have a disability to qualify for SSI.
SSI covers a diverse group of recipients:
Adults: Both disabled and non-disabled adults who meet the income and resource criteria can qualify for SSI.
Children: Children with disabilities that severely limit their daily activities are also eligible if they meet the income and resource criteria.
Elderly: Individuals aged 65 or older can qualify for SSI without the need for a disability, as long as they meet the other criteria.
Non-Citizens: There are additional rules and criteria for non-citizens to be eligible for SSI, which would need further exploration.
The amount an individual or family receives from SSI varies based on their circumstances, including their income, resources, and living arrangements. On average, the benefit amount is designed to ensure that recipients can meet their basic needs for food, clothing, and shelter. However, the exact amount can vary, and it's essential to consult the SSA's official resources or a financial advisor for precise figures.
So, will SSI get a $200 raise in 2023? The Social Security Expansion Act, which proposed an increase in Social Security benefits by $2,400 per year (or $200 per month), was introduced in both the House and Senate in June 2022. However, the legislation did not pass. This act aimed to provide an additional $200 monthly increase in Social Security benefits for both new and existing recipients, separate from the annual cost-of-living adjustment (COLA). If the bill had been approved, recipients would have seen an extra $2,400 per year on average.
The Social Security Expansion Act was championed by Sen. Bernie Sanders (I-Vt.), who reintroduced the legislation in the Senate on February 13, 2023. The bill was then referred to the Senate Committee on Finance1. The act aimed to benefit people who receive retirement, disability, and survivor benefits. However, it did not include those who receive Supplemental Security Income (SSI), which is a needs-based program for individuals with limited income and resources.
The fact that the legislation did not pass in 2022 and did not even make it to a vote before the 117th Congress officially ended on January 3 suggests that there was significant opposition or lack of support for the bill in Congress.
The proposed increase would have significantly benefited Social Security recipients, especially those on fixed incomes. An extra $2,400 per year could help cover essential expenses such as medical bills, housing, and food.
On the flip side, such an increase could have implications for the Social Security trust fund and might necessitate changes in taxation or other funding mechanisms to ensure the program's sustainability.
Amid record high inflation, the Social Security Administration announced an 8.7% increase to Social Security benefits for 2023. This marks the highest increase in 40 years. As a result, beneficiaries will see a benefit increase of more than $140 per month on average starting in January 2023. The average Social Security retiree benefit will rise from $1,681 in 2022 to $1,827 in 2023.
The 8.7% bump in benefits surpasses the 5.9% increase beneficiaries experienced in 2022, which at the time was the highest in four decades. The last time the cost-of-living adjustment (COLA) was higher was in 1981, with an increase of 11.2%.
This significant COLA for 2023 comes as beneficiaries have grappled with rising prices throughout the year. While COLAs are designed to help beneficiaries maintain their standard of living by providing inflation protection, they are not actual increases in benefits.
Two factors that may influence the size of benefit checks are Medicare Part B premiums and taxes. The standard Medicare Part B premium will decrease by $5.20 next year, dropping from $170.10 to $164.90. These payments are typically deducted directly from Social Security benefit checks. This reduction means that beneficiaries will likely retain most or all of their COLA increase.
The COLA is determined based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The Social Security Administration calculates the annual COLA by measuring the change in the CPI-W from the third quarter of the preceding year to the third quarter of the current year.
The historic high COLA in 2023 could potentially accelerate the depletion of the Social Security trust funds. The Social Security Board of Trustees has projected that the trust funds can pay full benefits through 2035. After that, the program will be able to cover 80% of benefits.
While there have been discussions and proposals about a $200 increase for SSI recipients in 2023, it's crucial to stay updated with official sources or trusted news outlets to confirm the final status of such proposals. To answer the question of “Will SSI get a $200 raise in 2023?”; while the proposal to increase Social Security benefits by $200 per month garnered attention and support from some quarters, it did not pass the legislative hurdles. It remains to be seen if future attempts to increase benefits will be successful.
Understand the relationship between SSI and pension by checking out our detailed guide. Visit Benefits Aid and browse through the available resources to learn more.