Yes, it is too early, but I cannot help myself. After perusing all the forecasts of inflation, here goes. Of course an explanation is needed as to the rules regarding determining C.O.L.A.
CPI-W (Consumer Price Index for Urban Wage Earners and Clerical Workers) is the gauge used, not the headline CPI, as in CPI-U (Consumer Price index for ALL Urban Consumers). The difference being the salaried and technical folks are in the latter.
Typically the CPI-W has lagged behind the CPI-U, (hereafter referred to simply CPI). This can be seen in the CPI reading of 292.296 (May-2022), compared to 288.022 for the CPI-W. Both started their indexes at the same time... back in the early 80s.
However, after lagging all that time, the CPI-W is catching up with a vengeance. Why? I don't know, maybe something to do with Covid. (That's intended to be humorous).
Certainly, a lot of things can change between now and then. Even the forecasts are suggesting a peak to inflation in July and then subsiding. It is not unreasonable to view current projections and expect 8.8%~9.1% as the potential range for C.O.L.A. adjustment. Although things appear to be outpacing forecasts to the downside.
- June CPI-W is forecast as 9.3%~9.4%
- July CPI-W is forecast as 9.2%~9.4%
- August CPI-W is forecast as 8.7%~9.0%
- September CPI-W forecast as 8.3%~8.5%.
Whatever the increase might be, it would be important to put that into perspective. Theoretically, the increase which comes in January 2023, puts you back to the purchasing power you had in July, August, and September of 2021. Any lost purchasing power is gone... forever.
The 2nd part of the discussion starts with Medicare Premiums. They jumped a lot this past year, due to the dementia drug and there is a belief that somehow a big drop is forthcoming as the Center for Medicare & Medicaid Services has altered their stance on that drug.
Fine, but the anticipated hike in 2022 was for a jump from $148.5 to $158, without the dementia drug. The dementia drug's actual cost same in about half of the anticipated, which brings it back to the $158~$160 range. What about the increases in Medicare costs, aside for the dementia drug?
I would not expect any great reductions in Medicare premiums for 2023, although it should not deduct from the C.O.L.A. increase... as it had in years past.
Now to the scams... my wife received a letter from a well known entity, decrying some legislation in Congress that was intended to undermine S.S. Contributions were desperately needed to help stop this legislation.
I checked and found the legislation was proposed back in early 2021 and has sat in committee since, and has apparently been forgotten by all... except the folks desperately looking for revenue sources.
Maybe I am becoming too cynical, but when someone asks for money to somehow benefit me... I immediately become suspicious of them. It has served me well.
