What You Have to Know
- The Shopper Value Index for People 62 years of age and older weights bills like well being care extra closely.
- Lawmakers argue the change from CPI-W would assist retirees higher sustain with rising prices.
- The CPI-E doesn’t all the time end in a much bigger COLA than the CPI-W.
Sen. Bob Casey, D-Pa., chairman of the Senate Particular Committee on Growing old, has launched new laws, the Boosting Advantages and COLAs for Seniors Act, that may direct the Social Safety Administration to regulate advantages based mostly on the Shopper Value Index for People 62 years of age and older (CPI-E).
The change to the cost-of-living adjustment calculations — which at present use the Shopper Value Index for City Wage Earners and Clerical Employees (CPI-W) — is meant to higher mirror the prices that older adults face. However a take a look at earlier COLAs exhibits that the senior-focused index wouldn’t all the time have resulted in increased advantages.
Co-sponsors of the invoice embrace Sens. Richard Blumenthal, D-Conn.; Peter Welch, D-Vt.; John Fetterman,. D-Pa.; Kirsten Gillibrand, D-N.Y.; and Bernie Sanders, I-Vt.
“As the prices of fundamental items and providers for seniors rise, we can’t enable that promise to be damaged,” Casey mentioned in a press release. “The Boosting Advantages and COLAs for Seniors Act would assist seniors cope with rising prices and be sure that Social Safety stays a lifeline for all who want it.”
The invoice, launched on March 21, additionally directs the Bureau of Labor Statistics to calculate and publish the CPI-E on a month-to-month foundation.
CPI-W vs. CPI-E
The COLA is at present based mostly on the CPI-W from the earlier yr. “CPI-W is reflective of the on a regular basis spending of People, and contains bills like meals, client items, and housing, amongst others,” Casey defined. “Regardless of this, Social Safety advantages haven’t saved up with prices and older adults are left struggling to afford meals, drugs, clothes, and different requirements.”
The CPI-E (E used to face for Aged) weights prices extra usually confronted by older adults, like medical bills, extra closely, Casey mentioned.