SSDI payments rose 2 percent in 2018, the first increase since 2016

Yes, Social Security Disability Insurance (SSDI) payments increased in 2018. The Cost of Living Adjustment (COLA) for that year was 2 percent, meaning the average SSDI payment went up by roughly 2 percent starting in January 2018. This was the first raise beneficiaries had received since 2016, after three years with no increase at all.

The 2 percent figure applied to everyone on SSDI, regardless of age or how long they had been receiving benefits. If you were receiving $1,000 per month in December 2017, your January 2018 payment would have been approximately $1,020. The exact dollar amount of your increase depended on what you were receiving before the adjustment.

COLA is calculated each year based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a measure of inflation published by the Bureau of Labor Statistics. When inflation is low or negative, there is no COLA. When inflation rises, COLA rises with it. The 2 percent adjustment in 2018 reflected the inflation that had occurred in the previous year.

Key Takeaways

  • SSDI payments increased 2 percent in January 2018 under the annual Cost of Living Adjustment.
  • This was the first COLA since 2016; beneficiaries received no increase in 2017 or 2015.
  • COLA is tied to inflation and is calculated the same way for all SSDI beneficiaries each year.
  • The 2018 COLA was lower than the increases that followed in 2019 and 2020, which were 1.6 percent and 1.3 percent respectively.

Why SSDI payments did not increase from 2015 to 2017

From 2009 through 2015, Social Security beneficiaries—including those on SSDI—received no COLA at all. Inflation was very low during the recovery from the 2008 financial crisis, and the formula for COLA showed no increase three years in a row. In 2016, inflation picked up slightly, and beneficiaries received a 0.3 percent raise, the smallest COLA on record.

In 2017, inflation fell again, and there was no COLA. This meant that someone on SSDI in 2017 was receiving the same dollar amount as they had in 2016. For people living on a fixed income, this meant no relief from rising costs of housing, food, or medical care. The lack of increases over many years was a source of hardship for many beneficiaries.

The 2 percent increase in 2018 was therefore meaningful to beneficiaries who had waited two years for any raise. However, it still did not fully make up for the years when inflation had occurred but COLA had not.

How COLA is calculated and announced

The Social Security Administration does not decide the COLA amount. Instead, it is set by law based on a formula tied to the Consumer Price Index. In October of each year, the Social Security Administration announces what the next year's COLA will be. That announcement tells beneficiaries what to expect when their January payment arrives.

The COLA for 2018 was announced in October 2017. Beneficiaries who were already receiving SSDI saw the increase show up automatically in their January 2018 payment. No process or request was needed. If you were receiving SSDI in December 2017, you received the 2 percent increase in January 2018 without having to do anything.

COLA applies to the primary insurance amount (PIA)—the base payment amount that Social Security calculates for you. It also applies to any family benefits paid to your spouse or children based on your SSDI record. Everyone on your benefit record receives the same percentage increase.

What the 2018 increase meant for the average beneficiary

The average SSDI payment in 2018 was approximately $1,197 per month. A 2 percent increase on that amount meant an average raise of about $24 per month. For someone receiving the maximum SSDI payment, which was $2,788 in 2018, the increase was approximately $56 per month.

These amounts varied by individual because SSDI payments are based on your own earnings record, not a flat rate. Someone who had worked and earned higher wages before becoming disabled would receive a higher payment than someone with a lower earnings history. The 2 percent increase applied equally to everyone, but the dollar amount of that increase depended on what you were already receiving.

For beneficiaries who also received Supplemental Security Income (SSI), the COLA increase to SSDI did not automatically increase their SSI payment. SSI has its own separate COLA, which is also announced in October and takes effect in January. In 2018, the SSI COLA was also 2 percent, so beneficiaries on both programs received the same percentage increase on both payments.

COLA increases in the years after 2018

The 2 percent COLA in 2018 was followed by smaller increases in the next two years. In 2019, the COLA was 1.6 percent. In 2020, it was 1.3 percent. These lower percentages reflected lower inflation during those years. Beginning in 2021, inflation began to rise more sharply, and COLA increases grew larger: 1.3 percent in 2021, 5.9 percent in 2022, and 8.7 percent in 2023.

The variation in COLA year to year shows why beneficiaries cannot predict what their payment will be in future years. The increase depends entirely on inflation, which is outside Social Security's control. Some years bring meaningful raises; other years bring no increase at all. Planning a budget on SSDI requires accounting for the possibility that your payment amount may stay the same from one year to the next.

How to find out what your 2018 payment was

If you were receiving SSDI in 2018 and want to know what your payment was that year, you can view your payment history through your Social Security account online at ssa.gov. You will need to create a my Social Security account if you do not already have one. Once logged in, you can see your payment history month by month, including the January 2018 payment that reflected the 2 percent increase.

You can also call Social Security at 1-800-772-1213 to ask about your 2018 payment history. Have your Social Security number ready. A representative can tell you what you were receiving in December 2017 and what the January 2018 payment was after the COLA increase.

If you are trying to understand how much you received in 2018 for tax purposes, you can also request a Social Security Benefit Statement, which shows your annual benefit amounts. This document is useful if you need to report SSDI income on your tax return or if you are explore for other programs that ask about your income history.

Frequently Asked Questions

Did everyone on SSDI get the same 2 percent increase in 2018?

Yes, everyone receiving SSDI in January 2018 received a 2 percent increase to their payment amount. The percentage was the same for all beneficiaries, though the dollar amount of the increase varied depending on what each person was receiving before the adjustment.

What if I was not receiving SSDI until after January 2018?

If your SSDI began in February 2018 or later, your first payment would have already included the 2 percent COLA. You would not receive a separate increase; the 2 percent was built into the amount Social Security calculated for you based on your earnings record.

Did the 2018 COLA increase affect Medicare premiums?

For most SSDI beneficiaries, Medicare Part B premiums are held harmless, meaning they cannot increase more than the COLA amount. In 2018, this protection meant that any COLA increase went to beneficiaries rather than being consumed by higher premiums. However, beneficiaries with higher incomes may have paid higher premiums regardless of the hold-harmless rule.

How is the 2018 COLA different from COLAs in other years?

The 2018 COLA of 2 percent was higher than the 2019 and 2020 increases but lower than the much larger increases that began in 2021 as inflation rose. It was also significantly higher than the years from 2010 to 2017, when many beneficiaries received no increase at all.