The federal government has announced that the Cost of Living Adjustment (COLA) for 2008 will be 2.3 percent. The increase will apply to military retired pay, as well as Social Security annuities and certain other federal payments. The new COLA is down from the 2007 increase of 3.3 percent and the 4.1 percent jump in 2006. Counterbalancing the COLA for Medicare beneficiaries will be a rise in Medicare premiums of $2.50, to $96.40 a month. Officials base the annual COLA for the following year on the change in consumer prices between the third quarter of the current year and the same quarter of the previous year.
