As Biden vows to ‘protect’ Social Security, here’s what we know about the future of benefits

As President Joe Biden, at a White House event on Tuesday, touted new legislation that will reduce Medicare drug pricing, he also vowed to protect both Medicare and Social Security in the face of what he called Republican attacks on the programs.

“I’ll protect those programs; I’ll make them stronger,” Biden said. “And I’ll lower your cost to be able to keep them.”

The recently enacted Inflation Reduction Act gives Medicare the ability to negotiate prescription drug prices. It also caps the maximum beneficiaries will pay for prescription drugs under the program to $2,000 per year. The cost of insulin for patients covered by Medicare will also be limited to $35 per month.

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While the president stopped short of laying out his own specific prescription to save Social Security, he also took issue with GOP plans for the program, which can only continue to pay full benefits for an estimated 13 years, barring legislative action.

Those included a plan from Republican Sen. Rick Scott of Florida that calls for sunsetting government programs like Medicare and Social Security every five years, as well as a proposal from Republican Sen. Ron Johnson of Wisconsin that calls for re-evaluating the programs annually. Those moves would put the programs “on the chopping block,” Biden said.

“Democrats may have broken a record for the number of lies told about me in one day,” Johnson tweeted on Tuesday. “I want to save Social Security, Medicare and Veterans benefits.”

A spokeswoman for Scott pointed to a recent interview where he said his plan would help make sure people get their Social Security benefits.

Biden also pointed to a Republican budget proposal “that will cut Medicare and Social Security,” he said.

The president’s comments come as leaders on both sides of the aisle have increasingly been trading barbs over plans for the program in the runup to the November election.

Advocates for expanding Social Security have been outspoken in their rejection of the Republican plans for the program.

“Saying we want it to sunset after five years, that’s not accountable, because what will you do?” said Nancy Altman, president of Social Security Works, adding that it’s not clear whether they would vote for the program, against it or to modify it.

“That’s just process, and you’re hiding behind process,” she said. “It’s clear what the process will be, which is undermining the program.”

Democrats have put forward their own plans to expand benefits, while imposing additional payroll taxes on the wealthy to pay for those increases.

That includes a popular Democratic House proposal named Social Security 2100: A Sacred Trust, that would calls for making benefits more generous while reapplying payroll taxes for wages over $400,000.

Sens. Bernie Sanders, I-Vt., and Elizabeth Warren, D-Mass., have also initiated their own proposal that would raise taxes for those with incomes of $250,000 and up.

Meanwhile, House lawmakers also recently considered a bipartisan bill to do away with rules that reduce benefits for public workers.

Biden touted similar Social Security reforms during his presidential campaign, though he has not endorsed specific plans for the program as president.

“The President has always understood that millions of Americans rely on Social Security and have been paying into the program since their first jobs as teenagers,” White House assistant press secretary Robyn Patterson told CNBC.com.

“That’s why he’s committed to protecting Social Security and combatting Congressional Republican efforts to put it on the chopping block year after year,” he said.

The president’s speech on Tuesday was a missed opportunity, according to Maya MacGuineas, president of the Committee for a Responsible Federal Budget.

“Unfortunately, the president used his speech to attack his political opponents on the issue as opposed to putting forward his own specific plan to secure Social Security, something he has failed to do over the course of his administration,” MacGuineas said in a statement.

Specific plans from both parties are needed to secure the future of both Social Security and Medicare, she said. Experts say both parties will need to come together and compromise in order to enact changes to the program.

“By leading an historic economic recovery that extended the Trust Fund, and fighting to give the Social Security Administration the resources it needs to effectively deliver benefits, President Biden is helping ensure Social Security can continue providing Americans the peace of mind they’ve earned,” Patterson said.

Even amid the uncertainty surrounding the future of Social Security, beneficiaries can expect to see bigger monthly checks next year.

Due to high inflation, estimates show the Social Security cost-of-living adjustment is poised to be the highest in decades, according to The Senior Citizens League.

The nonpartisan seniors group’s latest estimate points to an 8.7% COLA for 2023. One more month of consumer price index data will come in before the official bump for next year is announced by the Social Security Administration.

Reduced premiums for Medicare Part B, which covers outpatient care, will be reduced by about 3% next year, the Centers for Medicare and Medicaid Services said on Tuesday.

The standard monthly premium will be $164.90 in 2023, down from $170.10 this year. Because those premiums are often deducted directly from Social Security checks, beneficiaries will be poised to take home more money.

“In this time of rising prices, there is going to be a substantial cost-of-living adjustment in January and a reduction in the Medicare premium,” Altman said.

In other years, when the COLA has been smaller and Medicare Part B premiums larger, beneficiaries were less likely to see any increase to their benefits, she noted.

“This is a year when everyone will see an increase,” Altman said.