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Social Security and Medicare Numbers for 2014

Jacques Chambers, CLU,
Benefits Consultant

Posted December 30, 2013

Social Security and Medicare revise their benefits at the beginning of each year to update the programs for inflation with a Cost of Living Adjustment (COLA). For 2014, they have applied an inflation factor of 1.5%, again low since inflation in 2013 has remained low.

Those of you who are collecting Social Security benefits—either disability, retirement or survivor, spouse & children benefits—should have already received, or will be receiving shortly, a letter announcing the amount of your benefit for 2014.

For Persons Still Working

The withholding percentage for employees and self-employed individuals remains at 7.65% and 15.30% respectively. The 7.65% includes 6.20% retirement and 1.45% Medicare. Having started in January, 2013, persons earning more than $200,000 ($250,000 for married couples filing jointly) will continue to pay an additional 0.9% in Medicare taxes.

The Maximum Taxable Earnings for Social Security withholding is $117,000. There is no maximum on earnings for Medicare withholding.

However, most other numbers do change due to this inflation adjustment. Below is a quick rundown of the numbers affecting people on or considering Social Security Disability or Retirement:

Social Security Benefits

Supplemental Security Income (SSI): The federal contribution for SSI, the needs based benefits for aged (65+) and disabled, is increased to $721 for an individual and  $1,082 for a couple. Note that this is only the federal portion of SSI payments. Many states including California and New York supplement that with an additional payment.

The Resources or Asset Limit remains at $2,000 for an individual and $3,000 for a couple, not counting a residence and one vehicle.

Working Disabled: For persons collecting Social Security Disability Insurance (SSDI) benefits, the minimum monthly amount they must earn for that month to count as a Trial Work Month is $770 per month. There are nine Trial Work Months in a Trial Work Period during which a beneficiary can earn unlimited amounts without affecting the SSDI Benefit amount.

The Substantial Gainful Activity (SGA) amount for 2014 is $1,070 per month for a disabled beneficiary and $1,800 for a blind beneficiary. Social Security disability benefits will continue after the Trial Work Months are exhausted if the earnings remain below the SGA.

For persons collecting SSI Benefits and working, the numbers have not changed. SSI will not count the first $65 of monthly earnings ($85 if SSI is the only source of income). They will reduce the SSI payment by 50% of the earnings over $65 or $85.

Students collecting SSI have a different limit that allows them to earn more money during school breaks. The amount that students can earn without affecting their SSI benefit in 2014 is $1,750 per month and up to $7,060 per year.

Medicare Premiums for 2014:

Part A: (Hospital Insurance) Premium
Most people do not pay a monthly premium for Part A because either they or a spouse had 40 or more work credits of employment paying Social Security and Medicare payroll taxes prior to becoming eligible for Medicare.

For persons age 65 and over with less than 40 work credits, premiums may be charged based on the number of quarters/credits they earned while working:

  • The Part A premium is $235.00 for people having 30-39 credits of Medicare-covered employment.

  • The Part A premium is $426.00 per month for people who are not otherwise eligible for premium-free hospital insurance and have less than 30 credits of Medicare-covered employment.

Disabled persons who have returned to work and continued their Medicare beyond the maximum 93 months after the Trial Work Months would pay $426.00 per month for Medicare Part A.

Part B: (Medical Insurance) Premium
The basic Part B premium remains at $104.90 per month. For higher income individuals, Medicare surcharges the premium for Part B based on the beneficiary’s total income:

 You Pay

If Your Yearly Income Is

 

 Single

  Married Couple filing Jointly 

 $104.90

 $85,000 or less

$170,000 or less

 $146.90

 $85,001-$107,000

$170,001-$214,000 

 $209.80

 $107,001-$160,000

$214,001-$320,000 

 $272.70

 $160,001-$214,000

$320,001-$428,000 

 $335.70

 Above $214,000

Above $428,000


 You Pay

If You Are Married but You File a Separate Tax Return from Your Spouse and Your Yearly Income Is

 $104.90

 Under $85,000 or less

 $272.70

 $85,001-$129,000

 $335.70

Above $129,000


Medicare Deductible and Coinsurance

Amounts for 2014:
Part A: (pays for inpatient hospital, skilled nursing facility, and some home health care) For each benefit period*, Medicare pays all covered costs except the Medicare Part A deductible which is $1,216 for 2014 during the first 60 days. In addition, they will pay copay amounts for hospital stays that last beyond 60 days and no more than 150 days.

For each benefit period* you pay:

  • A total of $1,216 for a hospital stay of 1-60 days.

  • $304 per day for days 61-90 of a hospital stay.

  • $608 per day for days 91-150 of a hospital stay (Lifetime Reserve Days).

  • All costs for each day beyond 150 days

*A benefit period begins on the first day a person receives service as an inpatient in a hospital, and ends after he or she has been out of the hospital and has not received skilled care in any other facility for 60 days in a row.

Skilled Nursing Facility Copays

  • $152.00 per day for days 21 through 100 each benefit period.

Part B – Medical Insurance: (covers Medicare eligible physician services, outpatient hospital services, certain home health services, durable medical equipment)

  • Calendar Year Deductible remains the same at $147.00 per year.

  • Coinsurance remains generally at 80% of the Medicare Allowable Amount with the beneficiary liable for the remaining 20%. If the provider accepts “Medicare Assignment” the beneficiary cannot be charged more than the 20%. If the provider does not accept Medicare Assignment, the beneficiary may be liable for an additional 15% of the Medicare Allowable Amount.

Part D – Prescription Drug Coverage: The annual open enrollment period for 2013 just closed on 12/07/2013. Only people just becoming eligible for Medicare or persons who qualify for a Special Enrollment Period may enroll in a Part D plan before the next open enrollment begins on 10/15/2014.

Medicare Supplement (Medigap) and Medicare Advantage Plans – The insurance carrier has notified its enrollees of changes in premium and/or benefits, if any.

 Average Payments in 2014 after the 1.5% COLA Increase

 All Retired Workers 

$1,294

Aged Couple, Both Receiving Benefits

$2,111

Widowed Mother and Two Children

$2,622

Aged Widow(er) Alone

$1,243

Disabled Worker, Spouse and One or More Children

$1,943

All Disabled Workers

$1,148

To see how much you would be eligible for at retirement or on disability go to www.ssa.gov/mystatement. Setting up an account at that site will also give you the opportunity to review your annual earnings over your working career as reported to Social Security, allowing you to check them for accuracy.

 

Confused about applying for disability? Click here

[Jacques Chambers, CLU, and his company, Chambers Benefits Consulting, have over 35 years of experience in health, life and disability insurance and Social Security disability benefits. For the past twelve years, he has been assisting people with their rights, problems, and other issues concerning benefits and disability. He can be reached at jacques@helpwithbenefits.com or through his website at: http://www.helpwithbenefits.com.]

 

Copyright December 2013– Hepatitis C Support Project - All Rights Reserved. Permission to reprint is granted and encouraged with credit to the Hepatitis C Support Project.

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