Will a Social Security COLA Disqualify You From Medicare Savings Programs?

Every January, Social Security benefits go up with the cost-of-living adjustment. Every January, families who help a parent on a Medicare Savings Program wonder the same thing: does the higher check push them over the income limit?

It can — but there's a built-in protection that prevents anyone from losing coverage in the gap between the COLA and the new poverty guidelines.

The COLA Disregard: January and February Protection

Social Security COLAs take effect in January. But the updated Federal Poverty Guidelines — which set the MSP income thresholds — aren't published until late January or February and don't take effect in Kansas until March 1.

Federal law (42 U.S.C. 1396a(r)(2)) requires states to completely disregard the COLA increase during January and February for MSP eligibility. The KanCare Clearinghouse must use the pre-COLA Social Security amount when evaluating eligibility during those two months. Once the new poverty guidelines take effect on March 1, the higher income limits usually absorb the COLA increase, and coverage continues without interruption.

This protection is automatic. Your parent doesn't need to file anything or notify the Clearinghouse. The system is supposed to handle it — but if a termination notice arrives in January or February citing higher Social Security income, the COLA disregard wasn't applied correctly. That's an appealable error.

When the COLA Actually Does Push Someone Over

The disregard only covers the transition months. Starting March 1, the Clearinghouse uses actual gross Social Security (with the COLA) against the new FPL-based limits. Most years, the poverty guideline increase is close enough to the COLA that the math works out. But it doesn't always match perfectly.

A worked example: If a Kansas senior's post-COLA gross Social Security benefit is $1,390/month in 2026, subtracting the $20 disregard gives countable income of $1,370. That is above the 2026 QMB single limit of $1,350 but within the LMB range of $1,350.01 to $1,616. They may shift to LMB, which still pays the Part B premium but does not cover Medicare deductibles or coinsurance.

But they don't lose everything. At $1,370 countable income, they fall into the LMB range ($1,350.01 to $1,616 for 2026). LMB still pays the $202.90/month Part B premium. They lose QMB's coinsurance and deductible coverage, but the premium savings remain.

What to Do if the Numbers Are Close

If your parent's income is within $50 of the QMB limit, a COLA could shift their tier. Steps to take before January:

1. Check the gross Social Security amount (not the bank deposit). The 2026 COLA percentage applied to the current benefit gives the new gross amount.
2. Subtract $20 for the general income disregard.
3. Compare against the current MSP limits: QMB $1,350, LMB $1,616, ELMB $1,816 (single).
4. If it crosses a tier boundary, the Clearinghouse will catch it at the next redetermination. There's no way to prevent a legitimate tier change, but knowing in advance lets you prepare for reduced coverage rather than being surprised by a termination notice.

Also check whether your parent has any income that's excludable but may have been counted: VA Aid and Attendance is excluded from countable income, as are certain in-kind support payments.

COLA and Extra Help

Approval for QMB, LMB, or ELMB triggers automatic Extra Help (Part D Low-Income Subsidy). If a COLA pushes your parent above those MSP income limits, they lose the automatic Extra Help deeming. They can apply for Extra Help directly through Social Security (Form SSA-1020), which has higher income limits — roughly $1,883/month single in 2026.

The Kansas Medicare Savings Programs & Extra Help Guide includes an income calculation worksheet that walks through the COLA scenario step by step, including how to estimate tier changes before the annual adjustment hits.

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