Medicare Costs Could Wipe Out Social Security Cost-Of-Living Adjustment | Next year, Social Security recipients will see a 3.6 percent increase in benefits, the first cost-of-living adjustment since 2009. Starting in January, the 55 million Social Security recipients will see their monthly payment grow by $43, or about $516 for the year. But increases in Medicare Part B premiums, which must pay for 25 percent of the program costs, could wipe out those gains for many seniors. The average Social Security recipient could see one-fourth of their COLA increase for 2012 eaten up by the rise in Medicare premiums. The Affordable Care Act will work to the slow cost growth in Medicare in the years to come and could save the average beneficiary approximately $3,500 over the next decade.