What the 2020 SSDI raise was

In 2020, Social Security recipients—including people on SSDI—received a 1.3 percent cost-of-living adjustment (COLA). This meant that if you were receiving SSDI payments in December 2019, your January 2020 payment increased by 1.3 percent. For someone receiving $1,200 per month, that raise added roughly $16 per month.

The COLA is calculated each year by Social Security based on inflation data from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). It is not a discretionary raise—it is a formula-driven adjustment meant to keep benefits roughly in line with the cost of living. In years when inflation is low or negative, the COLA can be zero or very small, as it was in 2020.

The 2020 COLA was one of the smallest in recent history. For comparison, 2019 had a 2.8 percent COLA, and 2021 had a 1.3 percent COLA as well. The low 2020 figure reflected the relatively flat inflation environment of 2019, which is what the COLA calculation measures.

Key Takeaways

  • The 2020 COLA was 1.3 percent, meaning SSDI payments increased by that percentage starting in January 2020.
  • COLA is calculated automatically by Social Security using inflation data and does not require you to take any action to receive it.
  • The amount of your raise in dollars depends on your current payment amount—a higher payment means a larger dollar increase.
  • COLA adjustments affect not only SSDI but also Supplemental Security Income (SSI) and Social Security retirement benefits.

How the COLA is calculated each year

Social Security calculates the COLA by comparing the average CPI-W for the third quarter of the current year (July, August, September) to the average for the third quarter of the previous year. If there is an increase, that percentage becomes the COLA for the following year. The calculation happens in October, and Social Security announces the new COLA in mid-October for the January payment increase.

In 2020, the third-quarter 2019 CPI-W was lower than the third-quarter 2018 CPI-W, which is why the COLA was so modest. This reflected a period of low inflation across the economy. The formula is set by federal law and has been in place since 1975; Social Security does not have discretion to raise it higher or lower based on need or other factors.

Who received the 2020 COLA

Anyone receiving SSDI in December 2019 automatically received the 1.3 percent increase in their January 2020 payment. You did not need to report anything or take any action. The increase was applied to your account by Social Security.

The COLA also applied to people receiving Supplemental Security Income (SSI), Social Security retirement benefits, and Social Security survivor benefits. Family members receiving benefits on a worker's SSDI record also received the same percentage increase. If you were on SSDI and also receiving Medicare, the COLA did not affect your Medicare premiums in 2020—those are set separately and did not increase that year.

The difference between COLA and other payment changes

A COLA is not the same as a benefit review or a work incentive adjustment. If you were working and using a work incentive like Impairment Related Work Expenses (IRWE) or Plans to Achieve Self-Support (PASS), your benefit amount might have changed for reasons separate from the COLA. Similarly, if Social Security reviewed your case and found a change in your medical condition or work activity, that could result in a different benefit amount.

The COLA is a blanket adjustment applied to all beneficiaries at the same time. It does not depend on your individual circumstances. If your payment changed in 2020 for a reason other than the COLA—such as a work incentive calculation or a medical review—that change would have been explained in a separate notice from Social Security.

How the 2020 COLA affected Medicare and Medicaid

The 2020 COLA did not increase Medicare Part B premiums, which remained at $144.30 per month for most beneficiaries (though some paid higher amounts based on income). This was unusual—in many years, the COLA is partially or entirely offset by rising Medicare premiums, meaning beneficiaries see little or no net increase in their take-home payment.

Medicaid coverage was not affected by the COLA. If you were receiving both SSDI and Medicaid, your Medicaid status did not change because of the 1.3 percent raise. However, if your state had an income limit for Medicaid may be able to access tied to the federal benefit rate (the maximum SSDI payment), a COLA could theoretically push you over that limit in some states—though this is rare and your state Medicaid office would notify you if it happened.

COLA history and why 2020 was low

The 2020 COLA of 1.3 percent was the third-lowest in the history of the modern COLA formula. The lowest was 0 percent in 2010 and 2011, when there was no inflation. The second-lowest was 0.3 percent in 2017. By contrast, the 1980s saw COLA adjustments regularly above 10 percent because inflation was much higher then.

The 2020 figure reflected economic conditions in 2019, when inflation was subdued. The COVID-19 pandemic began in early 2020, but the COLA calculation was already complete by then. The 2021 COLA (announced in October 2020) was also 1.3 percent, but the 2022 COLA jumped to 5.9 percent as inflation rose sharply in 2021.

What to do if you did not see the 2020 raise

If you were receiving SSDI in December 2019 and did not see a 1.3 percent increase in your January 2020 payment, contact Social Security to ask why. Possible reasons include: you were a new beneficiary who started receiving payments after December 2019 (new beneficiaries do not receive the prior year's COLA); your payment was affected by a work incentive recalculation; or there was an error in your account.

You can contact Social Security by calling 1-800-772-1213 (TTY 1-800-325-0778) or by visiting your local Social Security office. Have your Social Security number ready and ask specifically about the 2020 COLA on your account. If you believe there was an error, Social Security can review your payment history and correct it if needed.

Frequently Asked Questions

Does the COLA automatically go into my bank account, or do I have to do something?

The COLA is automatic. Social Security calculates it and applies it to your account in January with no action needed on your part. If you receive payments by direct deposit, the new amount appears in your account on your regular payment date. If you receive a check, the check amount increases by 1.3 percent.

If I was not on SSDI for the full year 2019, did I still get the 2020 COLA?

You received the 2020 COLA only if you were receiving SSDI in December 2019. If you started SSDI in January 2020 or later, you did not receive the 2020 COLA. Your first COLA would be the 2021 adjustment, applied to your January 2021 payment.

Does the COLA raise affect how much I can earn while working?

No. The COLA does not change the Substantial Gainful Activity (SGA) limit or other work incentive thresholds for the year it is announced. Those limits are set separately and are announced at different times. A COLA only increases your monthly benefit payment amount.

What if my state reduced my Medicaid because my SSDI went up?

This is rare but possible in some states. If your state has an income limit for Medicaid tied to the federal benefit rate, a COLA could push you over it. If this happened, contact your state Medicaid office when ready. You may be able to use a work incentive or request a review to restore coverage.

Will there be another COLA in 2024 or 2025?

Yes. Social Security announces a new COLA every October for the following January. The amount depends on inflation data from the third quarter of that year. You can check the Social Security website in October to see what the upcoming COLA will be.