Social Security’s 2027 COLA Could Be the Biggest in 3 Years: Here’s What Retirees May Actually Keep

Retirees are being told that 2027 is likely to bring the largest Social Security raise in three years. The Senior Citizens League estimated in September that the 2027 cost-of-living adjustment (COLA) would land at about 3.5%, revised down from 3.6% in August. CNBC, reporting the estimate, noted what that means in dollars: “A beneficiary receiving $2,000 a month would get about $70 more before Medicare deductions.”

For most beneficiaries, the Medicare Part B premium is deducted from the Social Security payment before the money arrives, so the raise a retiree actually notices is the adjustment minus whatever Part B does that year.

Last year that deduction took a third of it. The 2026 adjustment was 2.8%, which raised the average retired-worker benefit from $2,015 a month to $2,071, an increase of $56. Over the same period, the standard Part B premium rose from $185.00 to $202.90, an increase of $17.90. On that average benefit, Part B absorbed about 32% of the raise. On a smaller benefit, it absorbed more, because the premium increase is a flat dollar amount and the adjustment is a percentage.

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The projection for 2027 is a much smaller bite. The 2026 Medicare Trustees Report puts the 2027 standard Part B premium at $209.50, up $6.60 from $202.90, an increase of roughly 3.25%. Run that against a 3.5% adjustment and the arithmetic is straightforward. A $2,000 benefit gains $70 and keeps $63.40 after the premium increase, meaning Part B takes about 9% of it. On the average $2,071 benefit, the raise is about $72.49, and the retained figure is about $65.89, which is roughly the same share. That is a materially better year than 2026, if the trustees are right.

They have been mistaken in the same direction before, and the size of the miss is on the record. In 2021 the trustees projected a 2022 standard Part B premium of $158.50. The Centers for Medicare and Medicaid Services finalized the 2022 premium at $170.10, which was $11.60 higher, or about 7.3% above the projection. Apply a miss of that size to the current projection, and the 2027 premium would land nearer $225 than $210, which would change the answer for every beneficiary. That illustrates a documented past gap, not a forecast, and no agency has said it will happen again.

One more official number is worth putting beside these. In its 2026 report, the same trustees projected a 2028 standard premium of $224.50 and a 2034 premium of $338.50, so their own baseline shows an upward multi-year trend regardless of what 2027 turns out to be. The 2027 Part B deductible is projected at $292, up $9.00 from $283.

A provision changes the math for part of the audience, and leaving it out would make this piece wrong for them. Under the hold-harmless rule, most beneficiaries who have their Part B premium deducted from a Social Security payment cannot have that payment fall in dollar terms because of a premium increase. In practice, the Part B increase is capped at the dollar value of the individual's adjustment. With a projected $70-plus raise against a projected $6.60 premium increase, the cap is unlikely to bind for most people in 2027, but it does not apply to everyone, including new enrollees and higher-income beneficiaries who pay income-related surcharges.

Nothing in the preceding paragraphs is final. The 2027 cost-of-living adjustment depends on the September consumer price index reading for urban wage earners, scheduled for release on Oct. 14, 2026, with the official announcement to follow. Estimates of the adjustment currently differ among the people producing them: the Senior Citizens League and AARP have been in the 3.5% to 3.6% range, and independent analyst Mary Johnson has published a lower figure. The final Part B premium is set through a separate Medicare process and is normally announced later in the autumn.

This is not a new pattern, and Barchart has covered both halves of it before, in an earlier look at how the 2026 adjustment was shaping up and in a breakdown of the 2025 increase and when it reached beneficiaries. Both pieces are by other Barchart contributors.

So the two numbers a beneficiary can hold onto until October are these. On current projections a $2,000 monthly benefit gains about $70 in 2027 and keeps about $63 of it after the Part B increase, against a 2026 raise of $56 on the average benefit of which $17.90 went straight back to Medicare. Both 2027 figures are estimates produced by different bodies on different timetables, and only one of them, the cost-of-living adjustment, will be settled next month.

On the date of publication, Caleb Naysmith did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.