Social Security and Medicare Changes Under New COLA

The cost-of-living adjustment for Social Security recipients, CSRS retirees and FERS retirees (other than special category employees) age 62 or older will be 1.5%.  Social Security changes for 2014 follow:

Medicare changes:

Part A deductible – $1,216 per benefit period

Part A co-pays:

Days 61 – 90 – $304 per day

60 lifetime reserve days – $608 per day

Part B deductible – $ 147 per year

Part B premium – $104.90 per month (may be higher for high income individuals)

Skilled nursing co-pay for over 20 days – $152 per day.

IRS has not yet announced whether or not there will be any changes in the elective deferral limit for the TSP or the contribution limits for IRAs.  Neither have they updated income restrictions on deducting one’s contributions to a traditional IRA, or in being able to contribute to a Roth IRA.  It is expected that they will announce any changes soon.

OPM has not yet announced the changes in inflation indexed benefits that will result from the COLA.  It is not expected that they will announce changes anytime soon.  In fact, they usually delay several months before they announce those changes.  I think that we can be safe if we multiply last year’s numbers by 1.015.  Knowing that I may be off by a dollar or so, I predict that the OPM changes will be:

• Children’s Survivor Benefits
  • With one living parent, the lesser of:
    • $501 per month per child; or
    • $1506 per month divided by the number of eligible children.
  • With no living parent, the lesser of:
    • $602 per month per child; of
    • $1808 per month divided by the number of eligible children.
• FERS lump-sum death benefit (fixed amount):
  • $31, 786.21