Medicare Part B and The Hold Harmless Rule - AMAC Foundation
We’re one month into the compilation of statistics leading to determination of Social Security’s 2026 cost-of-living adjustment (COLA). Inflation has cooled considerably while health care costs have not, causing attention to focus on what impact expected Medicare Part B premium increases will have on the January benefit adjustment.
Enter the Medicare “hold harmless” rule that ensures beneficiaries against the increase in the Part B premium exceeding the Social Security COLA. Under this rule, the premium increase is capped to prevent a decrease in the net Social Security benefit.
Here’s a recap of how the Hold Harmless Rule works. The rule prevents your monthly Social Security payment from being lowered if the Medicare Part B increase is more than the calculated cost of living used to adjust benefits. You must be receiving benefits from the prior year for it to protect you. For example, if you start your benefits in December, to be received in January, you will be protected by the rule. Most people will pay the increase as their benefit will be large enough to cover it.
It’s important to note that you are not protected if you are subject to the “Income Related Monthly Adjustment Amount” (IRMAA). If you owe a penalty on your Medicare Part B Premium from not enrolling during the proper time, the penalty portion can reduce your benefit. If you switch benefits, such as from your own retirement benefit to a survivor benefit, you are also not protected. If you are covered by Medicaid, and Medicaid will pay your Part B premium, you are also not protected.
The current estimate for the COLA for 2026 is 2.5%, although this is likely to change by the time the final calculation is made in October. COLA is determined by the difference between July, August and September of the current year and the same months in the previous year. The actual COLA amount is released around October 15th. Medicare Part B is estimated to be $206.50 in 2026. An increase of $21.50, a substantial increase. This amount isn’t confirmed until around the middle of November.
If you are protected by the Hold Harmless rule, you will not see the amount of your Social Security payment decreased. With the current estimates, your benefit would have to be $800 or less not to see an increase.
If you pay less than the full Medicare Part B premium in the current year, in future years, you must make up the difference. This means, if you receive an increase to your benefit in the following year, your Medicare Part B premium will be increased until you are paying the full current premium. The Hold Harmless Rule only allows you to temporarily avoid the full increase.
We know this can be a confusing topic. Our AMAC Foundation Social Security Advisory Service is available to answer questions you may have. Learn more about this free-to-the-public service …here .