Sponsors (3)
Introduced July 31, 2025 by Mazie Hirono · Last progress July 31, 2025
The bill increases and better-targets retirement benefits for older Americans and protects low-income eligibility, but does so at higher federal cost, added administrative complexity, and some uncertainty for beneficiaries and employers.
Seniors and near-retirees will likely receive higher Social Security benefits because COLAs will use an elderly-weighted CPI (CPI–E) and the bill also counts more wages above the contribution base toward benefits for people first eligible after 2025.
Low-income beneficiaries on SSI and Medicaid will not lose eligibility when COLA-driven benefit increases occur because those increases are excluded as income/resources for eligibility determinations.
The bill applies a graduated formula and new AIME bend points to phase in crediting earnings above the contribution base, making benefit increases more structured and less abrupt for future beneficiaries.
Taxpayers and the federal budget will face higher Social Security spending and increased Trust Fund pressure because larger COLAs and counting surplus earnings raise benefit payouts, potentially increasing deficits or requiring tax or benefit offsets.
Implementing a new monthly CPI–E and the revised benefit computations will impose administrative costs and complexity on BLS, SSA, and IRS, funded by unspecified appropriations.
Workers, the self-employed, and small-business owners will face more complex reporting and recordkeeping because wages and self-employment income above the contribution base must be prorated and integrated into benefit calculations.
Based on analysis of 4 sections of legislative text.
Creates a BLS CPI‑E for Social Security COLAs and changes how earnings above the Social Security wage base are counted using an "applicable percentage."
Creates a new Consumer Price Index for Elderly Consumers (CPI‑E) to be produced monthly by the Bureau of Labor Statistics and replaces the index used to compute Social Security cost‑of‑living adjustments with that CPI‑E for applicable future COLA calculations. It also changes how earnings above the Social Security contribution-and-benefit wage base are treated: for calendar years after 2025 an "applicable percentage" table will determine what portion of high earnings (including self‑employment income) is counted for Social Security tax and benefit computations. The bill directs the BLS to produce the CPI‑E, authorizes necessary appropriations for implementation, protects certain means‑tested program eligibility rules (SSI/Medicaid) from being affected by the benefit increases, and phases in the new wage/counting rules with effective dates in calendar years after 2025 (self‑employment rules applying to taxable years beginning in 2026 or later).