The Social Security Administration announced that monthly Social Security and Supplemental Security Income benefits for more than 52 million Americans will increase 4.1 percent in 2006, today.
Social Security and Supplemental Security Income benefits
increase automatically each year based on the rise in the Bureau of Labor
Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers
(CPI-W), from the third quarter of the prior year to the corresponding period of
the current year. This year's increase in the CPI-W was 4.1 percent.
The 4.1 percent Cost-of-Living Adjustment (COLA) will begin with benefits that
more than 48 million Social Security beneficiaries receive in January 2006.
Increased payments to 7 million Supplemental Security Income beneficiaries will
begin on December 30.
Some other changes that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $94,200 from $90,000. Of the estimated 161 million workers who will pay Social Security taxes in 2006, about 11.3 million will pay higher taxes as a result of the increase in the taxable maximum in 2006.
It is important to note that no one’s Social Security benefit will decrease as a result of the 2006 Medicare Part B premium increase, announced last month. By law, the Part B premium increase cannot be larger than a beneficiary’s COLA increase. More information about Medicare can be found at www.cms.hhs.gov.
The Medicare Part B monthly premium will be $88.50 in 2006, an increase of $10.30 from the current $78.20 premium. The 2006 premium is roughly the same as the CMS actuaries have been projecting since early this year.
Though premiums are rising, most Medicare beneficiaries will see significantly lower out-of-pocket health care costs in 2006 because of the savings in drug costs from the new Medicare prescription drug benefit. Also, about one-fourth of beneficiaries can receive assistance that pays for their entire Part B premium, and about one-third of beneficiaries can receive assistance for their Part D premium.
Continued rapid growth in the intensity and utilization of Part B services is the primary reason for the premium increase. This growth is seen in physician office visits, lab tests, minor procedures, and physician-administered drugs. It also includes rapid growth in hospital outpatient services. Additionally, increased fee-for-service expenditures contribute to higher payment rates to Medicare Advantage health plans. Also, enrollment in Medicare Advantage plans is increasing as those plans have become much more widely available. These factors are leading to higher Medicare costs related to the Medicare Advantage program. It should be noted that Medicare Advantage plans result in average beneficiary savings of $100 a month.
In addition, part of the premium increase is necessary to increase assets that, for accounting purposes, are held in the Part B trust fund. As the Medicare Board of Trustees noted in their March 23, 2005 report to Congress, a premium increase of 12 percent or more would be needed in 2006 to prevent a further decline in Part B trust fund assets and to help restore those assets to an adequate level.
Premiums and Deductibles for 2006
Part A Premium: $393 (not paid by 99 percent of beneficiaries)
Part A deductible: $952
Part B premium: $88.50
Part B deductible: $124
HUD posted the long awaited revised special claims guide. This document is a draft and information should not be incorporated in to your internal processes and procedures until the guide is officially released. You can download a copy of the guide (65 Pages) at http://www.hud.gov/offices/hsg/mfh/rfp/scg/scguidedraft.pdf. Comments should be submitted in E-Mail form to Arthur Goldstein, his E-mail address is
Arthur_D._Goldstein@hud.gov.
HUD has released the 2006 OCAFS, effective February 11, 2006. The U.S. average increase was 4%. For more information, refer to the HUD web site at http://hudclips.org/sub_nonhud/cgi/pdf/5842.pdf.
As of this morning, HUD has not released the 4350.3 Revision 1, Change 2 Handbook. The current official version is 4350.3 Revision 1, Change 1. We have seen instances where information included in Change 2 has been incorporated in to policy and procedure documents used on site and in management offices. Please keep in mind that the draft of Change 2 was released so that industry stakeholders could comment on the changes and ask HUD to make additional changes. We hope that HUD will take the comments submitted for Change 2 and incorporate some version of those changes in the official release. Right now, eligibility should be determined using the instruction provided in Change 1.
We look forward to seeing you in the following RBD Classes!!