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No Social Security disability cost of living increase in 2011

Every year around this time seniors and those who rely on Social Security disability benefits in New York await news of a possible cost of living increase.  Unfortunately, for the second year in a row the news was not what benefits recipients wanted to hear.


The Social Security Administration (SSA) announced that there would be no cost of living adjustment (COLA) in 2011 – just like there wasn’t one in 2010.  Why?


The Social Security Act allows for an automatic increase in benefits if the consumer price index indicates that it is necessary.  This law was enacted in 1972, and automatic annual cost of living checks started in 1975.  Without this law, SSDI recipients only received a cost of living increase if Congress enacted special legislation – so as you can imagine it didn’t happen very often, which wasn’t fair for benefits recipients.


Specifically, the Bureau of Labor Statistics checks the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of the last year a cost-of-living adjustment (COLA) was determined to the third quarter of the current year. 


This year, in the third quarter of 2010 there was no change in the CPI-W from the same time period in 2008 (the last time there was a COLA increase) – this means that by law no COLA is allowed.  However, there has been some talk about a $250 one-time check for all benefits recipients to make up for the lack of an increase.  Of course our lawmakers will have to agree on that, so it isn’t a sure thing.