Higher Medicare B premiums may mean your Social Security raise won’t go as far

Will the extra cash hit your Social Security check next year? Don’t spend it yet.

Medicare just announced premiums for 2026, and they’re about to take a cut of your cost of living increase. For the average retiree, what seemed like a $57 monthly increase will shrink to just $39 after accounting for changes in the standard monthly premium.

How does a Medicare B Premium change affect Social Security’s COLA?

While retirees are scheduled to receive a 2.8% increase from Social Security’s cost of living adjustment (COLA), the standard premium for Medicare Part B will reach $202.90, up $17.90 from 2025.

Because Medicare Part B premiums are automatically deducted from your Social Security payments, higher premiums cut directly into your COLA increase. Medicare Part B premiums cover basics like doctor visits, outpatient care, and some hospital services.

The average monthly Social Security benefit is $2,015. After a COLA of 2.8%, this should jump $57 to $2,072. But once Medicare takes the $17.90 cut, you’ll only be left with an extra $39.10 per month.

However, some won’t have to pay the full premium increase: If the premium increase is more than your COLA for 2026, your monthly benefits will remain the same. This is due to the rule known as the “hold harmless clause.”

For example, if your monthly benefit is less than $640, your COLA percentage will be less than $17.90 (the amount of the premium increase). So, your benefit next year will not only decrease, it will not grow either.

So why will Medicare Part B premiums increase next year?

“The increase in the standard premium and Part B deductible for 2026 is primarily due to expected price changes and assumed utilization increases that are consistent with historical experience,” the Centers for Medicare & Medicaid Services said in its press release.

Translation: Health care costs continue to rise, and more people are using Medicare services.