Yahoo Finance
Readers sound off: Rising medical bills are devouring Social Security checks
Kerry Hannon · Senior Columnist Fri, February 20, 2026 at 2:28 AM GMT+8 6 min read
The drubbing that monthly Social Security benefits take from out-of-pocket medical costs shocks many retirees.
My recent column highlighting how healthcare costs are eating into Social Security checks hit a nerve. Thousands of you shared how you’re grappling with the reality: that even including Medicare coverage and not accounting for long-term care, retirees are overwhelmed by premiums, copays, and a myriad of uncovered medical services.
These expenses make up roughly a third of a typical retiree’s Social Security income and almost a quarter of total income, according to a new report from the Center for Retirement at Boston College.
The following is an edited sample of some of your comments and my take on them. Feel free to chime in, of course, in the comments section at the end of this follow-up.
Free healthcare is a 'myth' of Medicare
My wife and I have Medicare and have generally good health. We still spend about $11,000 a year for healthcare services, (mostly for eyeglasses, hearing aids, and dental), and premiums for Part B and Part B Supplements. It is a myth that once you hit 65, Medicare provides "free healthcare."
Along those lines:
My wife and I, in retirement, spend over $1,000/month, which is approximately 25% of our Social Security income, for Medicare Part B, supplements, and deductibles. It is by far our largest annual expense.
Another reader added:
Between my wife and I, our health insurance premiums consume our ENTIRE Social Security checks put together. We are just glad it COVERS it, so far that is. Luckily SS is not our only source of income or we'd be toast.
One more piles on:
Retired and on Social Security and Medicare for 11 years now. 2026 is the first year that my dollar income (Social Security minus Medicare & Supplement) has gone DOWN.
Kerry: That squeeze means people are skipping medical care. More than half of America’s 55.8 million seniors have gone without at least one healthcare product or service to cut costs in the last 12 months, according to research from the Senior Citizens League. What are they skipping? Dental care, vision, and hearing.
It’s the COLA formula, stupid
Clearly, the COLA (cost-of-living) adjustment is neither accurate nor realistic if it is not keeping up with healthcare costs of retirees.
Another commenter added:
The cost-of-living index used does NOT track the specific products/services that retired folks experience!! In particular, a retired person's medical expenses are a much higher percentage of our yearly expenses, and these are not reflected in the currently used index.
Kerry: I agree there is a major disconnect.
Story Continues
The COLA is calculated by averaging inflation data for the third quarter of the year — July, August, and September — and then comparing that figure with the same data from the previous year based on the Consumer Price Index (CPI) for all urban wage earners and clerical workers (CPI-W).
The Consumer Price Index for the Elderly (CPI-E) — the alternative index for Americans age 62 and older — weighs healthcare costs more heavily than the CPI-W.
“The reality is most older Americans constantly tell us they believe the CPI-W, the measure used to calculate the COLA, underestimates inflation as they see it,” Shannon Benton, executive director of the Senior Citizens League, told Yahoo Finance.
The CPI-E is designed to reflect seniors’ budgets and tends to come in slightly higher than the CPI-W, which tracks inflation for people who work and live in cities, she said.
“Multiple bills have been introduced in Congress over the years to change the COLA calculation to the CPI-E, “but they keep getting bogged down in gridlock,” per Benton.
The devil is in the details
You have to really scrutinize charges and fees. My GP ordered a couple preventive care screenings that are 100% covered by Medicare Part B. The hospital called me to schedule, and I subsequently received an email with a copay notification. I called the hospital billing department to get an explanation. It turns out the scheduler put in the wrong diagnostic codes, so a copay was required. Once the correct codes were put in, I received a follow-up email with a zero copay and zero balance notice. If you don't ask, you may be paying for something you shouldn't.
Kerry: I personally had this happen when I was caring for my 90-year-old mother and she had an emergency room visit after a fall. When the bill arrived, I was stunned, having expected her Medicare coverage and supplemental policy to pay for her care.
After a slew of phone calls and emails the hospital’s billing department administrator discovered that the wrong codes for mom’s care had been used, and we were off the hook for the nearly five-figure amount.
It was a time-consuming hassle to push back, but I suspect many people get swallowed under medical debt because they accept the bill at face value.
The more you earn, the more you pay
My wife and I maxed out our 401(k) and 403(b) plans over our working years. I simply wasn’t fully aware of the impact that Social Security, pensions, and 401(k) withdrawals would have on our Medicare premiums and the income-related adjustment. For doing the right thing by saving for retirement, we’re penalized.
Kerry: This is one that bites. Since 2007, a beneficiary’s Part B monthly premium is based on his or her income. About 8% of Medicare users earn too much to qualify for the standard Part B and Part D premiums and must pay surcharges, known as Income-Related Monthly Adjustment Amounts (IRMAA). Details can be found on this fact sheet.
The surcharge is calculated on a sliding scale with five income brackets topping out at $500,000 and $750,000 for individual and joint filing, respectively. These figures change annually with inflation.
For 2026, these inflation-adjusted brackets start at above $109,000 for single tax filers and over $218,000 for joint filers. For these beneficiaries, total monthly Part B premiums range from $284.10 to $689.90. Part D surcharges range from $14.50 to $91.00.
Have a question about retirement? Personal finances? Anything career-related? Click here to drop Kerry Hannon a note.
The long-term care cliff
Just plan on 1/3 of your retirement nest egg paying for long-term healthcare.
Kerry: Numerous readers complained about the out-of-pocket cost of assisted care. The sticker shock is real.
An apartment in an assisted-living facility averaged $82,899 a year in 2025, up from $74,148 in 2024, according to the National Investment Center for Seniors Housing & Care — and costs go up as care needs increase. Units for dementia patients can run more than $100,000.
“About 80% of those ages 65 and over will require some long-term care, with nearly 20% requiring high-intensity care for more than three years,” said Anqi Chen, associate director of savings and household finance at the Center for Retirement Research at Boston College.
There are long-term care insurance policies you can purchase to cover some of these costs, but they are expensive and get more so as you age.
Most older Americans don’t realize that Medicare will not cover the costs of these facilities if their illness is long-term, and few have money set aside to pay for future living assistance expenses.
Kerry Hannon is a Senior Columnist at Yahoo Finance. She is a career and retirement strategist and the author of 14 books, including "Retirement Bites: A Gen X Guide to Securing Your Financial Future," "In Control at 50+: How to Succeed in the New World of Work," and "Never Too Old to Get Rich." Follow her on Bluesky and X.
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