New Casey-sponsored bill would change how COLAs are calculated for Social Security

24 March 2024- U.S. Senator Bob Casey (D-PA), Chairman of the U.S. Senate Special Committee on Aging, joined his colleagues Senators Richard Blumenthal (D-CT), Peter Welch (D-VT), John Fetterman (D-PA), Kirsten Gillibrand (D-NY), and Bernie Sanders (D-VT) to introduce the Boosting Benefits and COLAs for Seniors ActThe bill, Casey says, will help seniors contend with rising costs by changing the way that Social Security cost of living adjustments (COLAs) are calculated to increase benefits and more comprehensively reflect the costs incurred by older adults. Casey introduced the bill the same week that he held an Aging Committee hearing on preserving and protecting Social Security.

“For millions of older adults in Pennsylvania and across the Nation, Social Security is the promise of a safe and stable retirement,” said Chairman Casey (D-PA). “As the costs of basic goods and services for seniors rise, we cannot allow that promise to be broken. The Boosting Benefits and COLAs for Seniors Act would help seniors contend with rising costs and ensure that Social Security remains a lifeline for all who need it.”

Each year, Social Security benefits are adjusted by the Cost-of-Living Adjustment (COLA) formula. The COLA is currently based on the Consumer Price Index for Urban Wage Earners (CPI-W) from the previous year. CPI-W is reflective of the everyday spending of Americans, and includes expenses like food, consumer goods, and housing, among others.

Despite this, Social Security benefits have not kept up with costs and older adults are left struggling to afford food, medications, clothing, and other necessities. The Consumer Price Index for Americans aged 62 or older (CPI-E) is another price index that is more reflective of the actual costs incurred by older adults; for example, within CPI-E, medical expenses are weighted more heavily than they are in CPI-W. The Boosting Benefits and COLAs for Seniors Act would direct the Social Security Administration to adjust benefits based on CPI-E rather than CPI-W, if CPI-E would result in a larger increase in benefits, ensuring that seniors get a large enough increase in benefits to contend with the rise in costs they are facing.