Social Security benefits and Medicare Part B premiums are both projected to rise in 2027, directly shaping how much income retirees take home each month.
2027 Social Security COLA
The Social Security Administration announced a 3.6% Cost-of-Living Adjustment (COLA) for 2027. For a retiree receiving an average $2,000 monthly benefit, this adds roughly $72 per month ($864 annually) to help offset inflation.
Projected 2027 Medicare Part B Costs
According to the Medicare Trustees Report, the standard monthly Part B premium is projected to rise from $202.90 in 2026 to $209.50 in 2027, a $6.60 monthly increase. The annual Part B deductible is also expected to climb from $283 to approximately $292.
High-Deductible Medicare Supplement (Medigap) Increases
Retirees enrolled in high-deductible Medigap options, such as High-Deductible Plan G or High-Deductible Plan F, will also see higher upfront out-of-pocket limits in 2027:
- High-Deductible Plans F & G: The annual plan deductible rises by $100, moving from $2,950 in 2026 to $3,050 in 2027. Policyholders must pay this amount in Medicare-covered expenses out-of-pocket before the supplement begins covering cost-sharing.
- Plans K & L Out-of-Pocket Maximums: Out-of-pocket maximum caps are also increasing. Plan K's limit jumps from $8,000 to $8,360, while Plan L's limit increases from $4,000 to $4,180.
While these plans feature lower monthly premiums, beneficiaries who anticipate regular medical care should factor the higher $3,050 threshold into their annual healthcare budgeting.
How COLA and Medicare Part B Align
Because Part B premiums are deducted directly from Social Security checks, higher healthcare costs reduce your net COLA. To protect retirees, federal law includes a "hold harmless" provision ensuring that a standard Part B increase cannot cause your net Social Security benefit to decrease year-over-year.
When triggered, the government caps your Part B premium increase at the exact dollar amount of your COLA raise:
- If your COLA is $0: Your Part B premium cannot increase for that year, and you continue paying the previous year's rate.
- If your COLA is smaller than the premium increase: For example, if your COLA raises your benefit by $10 per month but the standard premium rises by $15, your premium increase is capped at $10. Your net monthly check remains flat rather than falling by $5.
- The "Catch-Up" Effect: If you paid a lower premium under this provision, your rate will catch back up to the standard rate in future years when a larger COLA can absorb the difference.
For 2027, the projected $6.60 Part B increase is small enough that the 3.6% COLA will comfortably outpace it for most beneficiaries, meaning the hold harmless provision will rarely be needed.
Higher Earners and IRMAA
Retirees paying the Income-Related Monthly Adjustment Amount (IRMAA) are not protected by the hold harmless rule. IRMAA surcharges are based on 2025 tax returns and apply to individuals making over roughly $112,000 or married couples earning over $224,000. For these households, higher Medicare premiums could absorb most or all of the 2027 COLA.
Official Documentation
The Centers for Medicare & Medicaid Services (CMS) finalizes official premium numbers each November. To review full program updates and projected coverage options, see the official publication: Your Medicare in 2027: What's New and Changing (PDF)
A raise in your Social Security check only helps if it grows faster than your healthcare costs.
Rising costs are a good reason to review your coverage and your income plan together. We can compare Medigap, Part D, and guaranteed income options side by side, at no cost to you.
