                    SOCIAL SECURITY, SSI, AND MEDICARE
                              FACTS FOR 1990 

The beginning of each year brings with it certain annual adjustments 
in Social Security programs. The changes include new tax rates, higher 
exempt earnings amounts, Social Security and SSI cost-of-living increases, 
and changes in deductible and co-insurance requirements under Medicare. 

Here are the new facts for 1990: FICA (Social Security) Tax Rate:  The tax
rate for employees and their employers during 1989 was 7.51%. The rate will
be 7.65% in 1990. The maximum FICA amount to be paid by an employee during 
1990 is $3,855.60, up from $3,604.80 during 1989. The increase results 
from a higher ceiling on earnings subject to tax, effective January 
1, 1990. Self-employed persons will pay a Social Security tax of 15.3% 
during 1990, and their maximum Social Security contribution will be 
$7,711.20.
   
Ceiling on Earnings Subject to Tax:  Social Security contributions 
will be paid during 1990 on the first $50,400.00 of earnings for employees 
and self-employed persons. This compares to the 1989 ceiling of $48,000.00. 

Quarters of Coverage:  Eligibility for retirement, survivors, 
and disability insurance benefits is based in large part on the number 
of quarters of coverage earned by an individual during periods of 
work. Anyone may earn up to four quarters of coverage during a single 
year. During 1989 a Social Security quarter of coverage was credited 
for earnings of $500.00 in any calendar quarter. Anyone who earned 
$2,000.00 for the year (regardless of when the earnings occurred during 
the year) was given four quarters of coverage. In 1990 a Social Security 
quarter of coverage will be credited for earnings of $520.00 for a 
calendar quarter, and four quarters can be earned with annual earnings 
of $2,080.00.  

Exempt Earnings:  The earnings exemption for blind people receiving 
Social Security Disability Insurance (SSDI) benefits is the same as 
the exempt amount for individuals age 65 through 69 who receive Social 
Security retirement benefits. The monthly exempt amount in 1989 was 
$740.00 of gross earned income. During 1990 the exempt amount will 
be $780.00. Technically, this exemption is referred to as an amount 
of monthly gross earnings which does not show "substantial gainful 
activity."  Earnings of $780.00 or more per month before taxes 
for a blind SSDI beneficiary in 1990 will show substantial gainful 
activity after subtracting any unearned (or subsidy) income and applying 
any deductions for impairment-related work expenses. 

Social Security Benefit Amounts for 1990:  All Social Security 
benefits, including retirement, survivors, disability, and dependents 
benefits are increased by 4.7% beginning January, 1990. The exact dollar
increase for any individual will depend upon the amount being 
paid. Under pressure from senior citizens, Congress has repealed the 
Medicare Catastrophic Coverage Act. Among other things, that Act required 
Medicare beneficiaries to pay additional monthly premiums. Beginning 
January 1, 1990, both the benefits and the premiums resulting from 
the Catastrophic Coverage Act are gone. Therefore, monthly Social 
Security checks for Medicare beneficiaries will be increased to reflect 
lower Medicare premiums. Beneficiaries should expect the decrease 
in Medicare premiums to be reflected in Social Security checks some 
time during 1990. A Medicare premium refund check should also be sent 
to each beneficiary for excess premiums withheld during 1990.  

Standard SSI Benefit Increase:  Beginning January, 1990, the 
federal payment amounts for Supplemental Security Income (SSI) individuals 
and couples are as follows:  individuals, $386.00 per month; couples, 
$579.00 per month. These amounts are increased from:  individuals, 
$368.00 per month; couples, $553.00 per month. 

Medicare Deductibles and Co-insurance:  Medicare Part A coverage 
provides hospital insurance to most Social Security beneficiaries. 
The co-insurance payment is the charge that the hospital makes to 
a Medicare beneficiary for any hospital stay. Medicare then pays the 
hospital charges above the beneficiary's co-insurance amount. The 
basic co-insurance amount for Medicare Part A was $560.00 for a hospital 
stay in 1989. There was no co-insurance amount for beneficiaries to 
pay for hospital stays longer than sixty days. This was one of the 
benefits of the Medicare Catastrophic Coverage Act, which became effective 
January 1, 1989. That Act has now been repealed, effective January 
1, 1990. As a result, the Part A co-insurance amount for hospital 
stays from sixty-one through ninety days is $148.00 a day. Each Medicare 
beneficiary has sixty "reserve days" for hospital stays longer 
than ninety days. The co-insurance amount to be paid during each reserve 
day is $296.00. 

The Medicare Part B (medical insurance) deductible remains at an annual 
$75.00. The Medicare Part B basic monthly premium rate will be reduced 
from $31.90 charged to each beneficiary during 1989, to $28.60 per 
month during 1990. This reduction results from the repeal of the Medicare 
Catastrophic Coverage Act. The Part B premium is automatically deducted 
from Social Security checks. The monthly deduction for the first several 
months of 1990 will be $33.90. All beneficiaries can expect to receive 
a refund some time during 1990 for excess Medicare premiums paid. 
For anyone who pays the basic Medicare Part B premium, the refund 
should be the difference between $33.90 and $28.60, times the number 
of months of higher premium payments.
