Retirees caught in a double bind in 2011 – no COLA, low returns

October 15, 2010

Reuters writer Donna Smith takes a look at the discouraging financial picture facing many Social Security recipients in 2011. With the announcement this week that there would be no COLA increase for the second year in a row, coupled with low returns on their savings, many retirees will be forced to tighten their belts as their real costs – for food, energy, and medical care – continue to rise. “The average Social Security benefit is around $14,000 and experts say about one-third of retirees rely on the payouts from the government-run program for more than 90 percent of their income,” according to Ms. Smith. 

Fortunately, we’re seeing some good news on the Medicare premium front – on top of a predicted average 2011 decrease in Medicare Advantage premiums of 1 percent, a new report out today from Avalere predicts that Part D premiums for the top ten most popular plans will grow by just .23 percent- a sharp drop from the consulting company’s prediction a month ago that they would rise by 10 percent in 2011.

2 Responses to “Retirees caught in a double bind in 2011 – no COLA, low returns”

  1. Bert Noack said

    Sirs:

    I can’t make a decision on my Health care until I review the Medigap plan, which I understand won’t be out untill 12/01/10. Same thing happened last year and I did not get my plan”s card until Feb.
    Please xplain

    Bert Noack

    • cholla45 said

      Hello Mr. Noack,
      Since you submitted the comment twice I’m posting this reply under both comments –

      All Medigap plans have to submit their planned rate increases to your state Department of Insurance for approval, and they can’t publish that information until they have the DoI approval in hand. It’s pretty normal for Medigap plan rates not to be available until December 1st.

      I talked with the person at Extend Health who manages our relationships with insurance companies, and he says you can expect the usual rate increase for these plans to be between 6 and 8 percent. (You are always welcome to call one of our Benefit Advisors and ask them to help you review available plans in your area to see if you can find a better value for your money. The general number for our service center is 1-866-322-2824.)

      If you’re referring to some other issue than the 2011 premium rate, can you please reply with a little more detail and I’ll see if I can find an answer? Thanks!

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