There is some good news this month for recipients of Social Security benefits:  The White House has dropped the chained CPI (Consumer Price Index) from the upcoming federal budget.  As we reported in this newsletter in April of last year, the chained CPI would be bad news for older and disabled Americans and their families who receive Social Security benefits.


The federal government uses the CPI to set annual cost of living adjustments (COLA) for those receiving Social Security payments.  How the feds estimate the changes in the cost of living has a direct and significant impact for those depending on their Social Security checks.  Chained CPI would attempt to factor into calculations of the rate of inflation changes in demand that occur when prices rise and people substitute lower price goods.  Because chained CPI would result in an apparent lower rate of inflation, COLA under chained CPI would be lower.  But for those drawing Social Security benefits even small reductions in COLA add up to big reductions over time.


Terry O’Neill, President of the National Organization for Women says taking chained CPI off the table  “is a huge relief for women over 75, people with disabilities, and military veterans, in other words some of the most vulnerable among us.”

Sean D. Cuddigan
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SSA and VA Disability Attorney in Omaha, Nebraska
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