II 

115TH CONGRESS 

1ST SESSION S. 1600 

To amend title II of the Social Security Act and the Internal Revenue 

Code of 1986 to make improvements in the old-age, survivors, and 

disability insurance program, and to provide for Social Security benefit 

protection. 

IN THE SENATE OF THE UNITED STATES 

JULY 20, 2017 

Ms. HIRONO (for herself and Mr. MERKLEY) introduced the following bill; 

which was read twice and referred to the Committee on Finance 

A BILL 

To amend title II of the Social Security Act and the Internal 

Revenue Code of 1986 to make improvements in the 

old-age, survivors, and disability insurance program, and 

to provide for Social Security benefit protection. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may cited as the ‘‘Pro5 tecting and Preserving Social Security Act’’. 

6 (b) TABLE OF CONTENTS.—The table of contents of 

7 this Act is as follows: 

Sec. 1. Short title and table of contents. 


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TITLE I—COST-OF-LIVING INCREASES 

Sec. 101. Consumer Price Index for Elderly Consumers. 

Sec. 102. Computation of cost-of-living increases. 

TITLE II—CONTRIBUTION AND BENEFIT FAIRNESS 

Sec. 201. Determination of wages and self-employment income above contribution and benefit base after 2017. 

Sec. 202. Inclusion of surplus earnings in Social Security benefit formula. 

1 TITLE I—COST-OF-LIVING 

2 INCREASES 

3 SEC. 101. CONSUMER PRICE INDEX FOR ELDERLY CON4 SUMERS. 

5 (a) IN GENERAL.—The Bureau of Labor Statistics 

6 of the Department of Labor shall prepare and publish an 

7 index for each calendar month to be known as the ‘‘Con8 sumer Price Index for Elderly Consumers’’ that indicates 

9 changes over time in expenditures for consumption which 

10 are typical for individuals in the United States who are 

11 62 years of age or older. 

12 (b) EFFECTIVE DATE.—Subsection (a) shall apply 

13 with respect to calendar months ending on or after July 

14 31 of the calendar year following the calendar year in 

15 which this Act is enacted. 

16 (c) AUTHORIZATION OF APPROPRIATIONS.—There 

17 are authorized to be appropriated such sums as are nec18 essary to carry out the provisions of this section. 


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1 SEC. 102. COMPUTATION OF COST-OF-LIVING INCREASES. 

2 (a) IN GENERAL.—Section 215(i)(1) of the Social Se3 curity Act (42 U.S.C. 415(i)(1)) is amended by adding 

4 at the end the following new subparagraph: 

5 ‘‘(H) the term ‘Consumer Price Index’ 

6 means the Consumer Price Index for Elderly 

7 Consumers (CPI–E, as published by the Bu8 reau of Labor Statistics of the Department of 

9 Labor).’’. 

10 (b) APPLICATION TO PRE-1979 LAW.— 

11 (1) IN GENERAL.—Section 215(i)(1) of the So12 cial Security Act as in effect in December 1978, and 

13 as applied in certain cases under the provisions of 

14 such Act as in effect after December 1978, is 

15 amended by adding at the end the following new 

16 subparagraph: 

17 ‘‘(D) the term ‘Consumer Price Index’ 

18 means the Consumer Price Index for Elderly 

19 Consumers (CPI–E, as published by the Bu20 reau of Labor Statistics of the Department of 

21 Labor).’’. 

22 (2) CONFORMING AMENDMENT.—Section 

23 215(i)(4) of the Social Security Act (42 U.S.C. 

24 415(i)(4)) is amended by inserting ‘‘and by section 

25 102 of the Protecting and Preserving Social Security 

26 Act’’ after ‘‘1986’’. 


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1 (c) NO EFFECT ON ADJUSTMENTS UNDER OTHER

2 LAWS.—Section 215(i) of the Social Security Act (42 

3 U.S.C. 415(i)) is amended by adding at the end the fol4 lowing: 

5 ‘‘(6) Any provision of law (other than in this 

6 title or title XVI) which provides for adjustment of 

7 an amount based on a change in benefit amounts re8 sulting from a determination made under this sub9 section shall be applied and administered without re10 gard to the amendments made by section 102 of the 

11 Protecting and Preserving Social Security Act.’’. 

12 (d) NO EFFECT ON ELIGIBILITY FOR SSI AND MED13 ICAID.—Any increase to an individual’s monthly benefit 

14 amount under title II of the Social Security Act as a result 

15 of the amendments made by this section shall not be re16 garded as income or resources for any subsequent month, 

17 for purposes of determining the eligibility of the recipient 

18 (or the recipient’s spouse or family) for benefits or assist19 ance, or the amount or extent of benefits or assistance, 

20 under the Supplemental Security Income program or the 

21 Medicaid program. 

22 (e) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to determinations made with re24 spect to cost-of-living computation quarters (as defined in 

25 section 215(i)(1)(B) of the Social Security Act (42 U.S.C. 


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1 415(i)(1)(B))) ending on or after September 30 of the sec2 ond calendar year following the calendar year in which this 

3 Act is enacted. 

4 TITLE II—CONTRIBUTION AND 

5 BENEFIT FAIRNESS 

6 SEC. 201. DETERMINATION OF WAGES AND SELF-EMPLOY7 MENT INCOME ABOVE CONTRIBUTION AND 

8 BENEFIT BASE AFTER 2017. 

9 (a) DETERMINATION OF WAGES ABOVE CONTRIBU10 TION AND BENEFIT BASE AFTER 2017.— 

11 (1) AMENDMENTS TO THE INTERNAL REVENUE

12 CODE OF 1986.—Section 3121 of the Internal Rev13 enue Code of 1986 is amended— 

14 (A) in subsection (a)(1), by inserting ‘‘the 

15 applicable percentage (determined under sub16 section (c)(1)) of’’ before ‘‘that part of the re17 muneration’’; and 

18 (B) in subsection (c), by striking ‘‘(c) IN19 CLUDED AND EXCLUDED SERVICE.—For pur20 poses of this chapter, if’’ and inserting the fol21 lowing: 

22 ‘‘(c) SPECIAL RULES FOR WAGES AND EMPLOY23 MENT.— 

24 ‘‘(1) APPLICABLE PERCENTAGE OF REMUNERA25 TION IN DETERMINING WAGES.—For purposes of 


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1 paragraph (1) of subsection (a), the applicable per2 centage for a calendar year, in connection with any 

3 calendar year referred to in such subparagraph, 

4 shall be the percentage determined in accordance 

5 with the following table: 

The applicable 

‘‘In the case of: percentage is: 

Calendar year 2018 ..................................................................... 86%

Calendar year 2019 ..................................................................... 71%

Calendar year 2020 ..................................................................... 57%

Calendar year 2021 ..................................................................... 43%

Calendar year 2022 ..................................................................... 29%

Calendar year 2023 ..................................................................... 14%

Calendar years after 2023 ........................................................... 0%. 

6 ‘‘(2) INCLUDED AND EXCLUDED SERVICE.—For 

7 purposes of this chapter, if’’. 

8 (2) AMENDMENTS TO THE SOCIAL SECURITY

9 ACT.—Section 209 of the Social Security Act (42 

10 U.S.C. 409) is amended— 

11 (A) in subsection (a)(1)— 

12 (i) in subparagraph (I)— 

13 (I) by inserting ‘‘and before 

14 2018’’ after ‘‘1974’’; and 

15 (II) by inserting ‘‘and’’ after the 

16 semicolon; and 

17 (ii) by adding at the end the following 

18 new subparagraph: 

19 ‘‘(J) The applicable percentage (deter20 mined under subsection (l)) of that part of re21 muneration which, after remuneration (other 


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1 than remuneration referred to in the succeeding 

2 subsections of this section) equal to the con3 tribution and benefit base (determined under 

4 section 230) with respect to employment has 

5 been paid to an individual during any calendar 

6 year after 2017 with respect to which such con7 tribution and benefit base is effective, is paid to 

8 such individual during such calendar year;’’; 

9 and 

10 (B) by adding at the end the following new 

11 subsection: 

12 ‘‘(l) For purposes of subparagraph (J) of subsection 

13 (a)(1), the applicable percentage for a calendar year, in 

14 connection with any calendar year referred to in such sub15 paragraph, shall be the percentage determined in accord16 ance with the following table: 

The applicable 

‘‘In the case of: percentage is: 

Calendar year 2018 ..................................................................... 86%

Calendar year 2019 ..................................................................... 71%

Calendar year 2020 ..................................................................... 57%

Calendar year 2021 ..................................................................... 43%

Calendar year 2022 ..................................................................... 29%

Calendar year 2023 ..................................................................... 14%

Calendar years after 2023 ........................................................... 0%.’’. 

17 (3) EFFECTIVE DATE.—The amendments made 

18 by this subsection shall apply with respect to remu19 neration paid in calendar years after 2017. 


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1 (b) DETERMINATION OF SELF-EMPLOYMENT IN2 COME ABOVE CONTRIBUTION AND BENEFIT BASE AFTER

3 2017.— 

4 (1) AMENDMENTS TO THE INTERNAL REVENUE

5 CODE OF 1986.—Section 1402 of the Internal Rev6 enue Code of 1986 is amended— 

7 (A) in subsection (b)(1), by inserting ‘‘an 

8 amount equal to the applicable percentage (as 

9 determined under subsection (d)(2)) of’’ before 

10 ‘‘that part of the net earnings from self-employ11 ment’’; and 

12 (B) in subsection (d)— 

13 (i) by striking ‘‘(d) EMPLOYEE AND

14 WAGES.—The term’’ and inserting the fol15 lowing: 

16 ‘‘(d) RULES AND DEFINITIONS.— 

17 ‘‘(1) EMPLOYEE AND WAGES.—The term’’; and 

18 (ii) by adding at the end the fol19 lowing: 

20 ‘‘(2) APPLICABLE PERCENTAGE OF NET EARN21 INGS FROM SELF-EMPLOYMENT IN DETERMINING

22 SELF-EMPLOYMENT INCOME.—For purposes of para23 graph (1) of subsection (b), the applicable percent24 age for a taxable year beginning in any calendar 

25 year referred to in such paragraph shall be the perVerDate Sep 11 2014 04:51 Jul 28, 2017 Jkt 069200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1600.IS S1600

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1 centage determined in accordance with the following 

2 table: 

The applicable 

‘‘In the case of: percentage is: 

Calendar year 2018 ..................................................................... 86%

Calendar year 2019 ..................................................................... 71%

Calendar year 2020 ..................................................................... 57%

Calendar year 2021 ..................................................................... 43%

Calendar year 2022 ..................................................................... 29%

Calendar year 2023 ..................................................................... 14%

Calendar years after 2023 ........................................................... 0%.’’. 

3 (2) AMENDMENTS TO THE SOCIAL SECURITY

4 ACT.—Section 211 of the Social Security Act (42 

5 U.S.C. 411) is amended— 

6 (A) in subsection (b)— 

7 (i) in paragraph (1)(I)— 

8 (I) by striking ‘‘or’’ after the 

9 semicolon; and 

10 (II) by inserting ‘‘and before 

11 2018’’ after ‘‘1974’’; 

12 (ii) by redesignating paragraph (2) as 

13 paragraph (3); and 

14 (iii) by inserting after paragraph (1) 

15 the following new paragraph: 

16 ‘‘(2) For any taxable year beginning in any cal17 endar year after 2017, an amount equal to the appli18 cable percentage (as determined under subsection 

19 (l)) of that part of net earnings from self-employ20 ment which is in excess of (A) an amount equal to 

21 the contribution and benefit base (determined under 


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1 section 230) that is effective for such calendar year, 

2 minus (B) the amount of the wages paid to such in3 dividual during such taxable year; or’’; and 

4 (B) by adding at the end the following: 

5 ‘‘(l) For purposes of paragraph (2) of subsection (b), 

6 the applicable percentage for a taxable year beginning in 

7 any calendar year referred to in such paragraph, shall be 

8 the percentage determined in accordance with the fol9 lowing table: 

The applicable 

‘‘In the case of: percentage is: 

Calendar year 2018 ..................................................................... 86%

Calendar year 2019 ..................................................................... 71%

Calendar year 2020 ..................................................................... 57%

Calendar year 2021 ..................................................................... 43%

Calendar year 2022 ..................................................................... 29%

Calendar year 2023 ..................................................................... 14%

Calendar years after 2023 ........................................................... 0%.’’. 

10 (3) EFFECTIVE DATE.—The amendments made 

11 by this subsection shall apply with respect to taxable 

12 years beginning during or after calendar year 2018. 

13 SEC. 202. INCLUSION OF SURPLUS EARNINGS IN SOCIAL SE14 CURITY BENEFIT FORMULA. 

15 (a) INCLUSION OF SURPLUS AVERAGE INDEXED

16 MONTHLY EARNINGS IN DETERMINATION OF PRIMARY

17 INSURANCE AMOUNTS.— 

18 (1) IN GENERAL.—Section 215(a)(1)(A) of the 

19 Social Security Act (42 U.S.C. 415(a)(1)(A)) is 

20 amended— 


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1 (A) in clauses (i), (ii), and (iii), by insert2 ing ‘‘basic’’ before ‘‘average indexed monthly 

3 earnings’’ each place it appears; 

4 (B) in clause (ii), by striking ‘‘and’’ at the 

5 end; and 

6 (C) by inserting after clause (iii) the fol7 lowing new clauses: 

8 ‘‘(iv) 3 percent of the individual’s surplus aver9 age indexed monthly earnings to the extent such 

10 surplus average indexed monthly earnings do not ex11 ceed the excess of the amount established for purposes of this clause by subparagraph (B) over 1 12 ⁄12

13 of the contribution and benefit base for the last of 

14 such individual’s computation base years, and 

15 ‘‘(v) 0.25 percent of the sum of the individual’s 

surplus average indexed monthly earnings plus 1 16 ⁄12

17 of the contribution and benefit base for the last of 

18 such individual’s computation base years, to the ex19 tent such sum exceeds the amount established for 

20 purposes of clause (iv) by subparagraph (B).’’. 

21 (2) BEND POINT FOR SURPLUS EARNINGS.— 

22 Section 215(a)(1)(B) of such Act (42 U.S.C. 

23 415(a)(1)(B)) is amended— 

24 (A) in clause (ii), by striking ‘‘the amounts 

25 so established’’ and inserting ‘‘the amounts esVerDate Sep 11 2014 04:51 Jul 28, 2017 Jkt 069200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S1600.IS S1600

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1 tablished for purposes of clauses (i) and (ii) of 

2 subparagraph (A)’’; 

3 (B) by redesignating clause (iii) as clause 

4 (v); 

5 (C) in clause (v) (as redesignated), by in6 serting ‘‘or (iv)’’ after ‘‘clause (ii)’’; and 

7 (D) by inserting after clause (ii) the fol8 lowing new clauses: 

9 ‘‘(iii) For individuals who initially become eligible for 

10 old-age or disability insurance benefits, or who die (before 

11 becoming eligible for such benefits), in the calendar year 

12 2018, the amount established for purposes of clause (iv) 

13 of subparagraph (A) shall be $10,958. 

14 ‘‘(iv) For individuals who initially become eligible for 

15 old-age or disability insurance benefits, or who die (before 

16 becoming eligible for such benefits), in any calendar year 

17 after 2018, the amount established for purposes of clause 

18 (iv) of subparagraph (A) shall equal the product of the 

19 amount established with respect to the calendar year 2018 

20 under clause (iii) of this subparagraph and the quotient 

21 obtained by dividing— 

22 ‘‘(I) the national average wage index (as de23 fined in section 209(k)(1)) for the second calendar 

24 year preceding the calendar year for which the de25 termination is made, by 


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1 ‘‘(II) the national average wage index (as so de2 fined) for 2016.’’. 

3 (b) BASIC AIME AND SURPLUS AIME.— 

4 (1) BASIC AIME.—Section 215(b)(1) of such 

5 Act (42 U.S.C. 415(b)(1)) is amended— 

6 (A) by inserting ‘‘basic’’ before ‘‘average’’; 

7 and 

8 (B) in subparagraph (A), by striking 

9 ‘‘paragraph (3)’’ and inserting ‘‘paragraph 

10 (3)(A)’’ and by inserting before the comma the 

11 following: ‘‘to the extent such total does not ex12 ceed the contribution and benefit base for the 

13 applicable year’’. 

14 (2) SURPLUS AIME.— 

15 (A) IN GENERAL.—Section 215(b)(1) of 

16 such Act (as amended by paragraph (1)) is 

17 amended— 

18 (i) by redesignating subparagraphs 

19 (A) and (B) as clauses (i) and (ii), respec20 tively; 

21 (ii) by inserting ‘‘(A)’’ after ‘‘(b)(1)’’; 

22 and 

23 (iii) by adding at the end the fol24 lowing new subparagraph: 


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1 ‘‘(B)(i) An individual’s surplus average indexed 

2 monthly earnings shall be equal to the quotient obtained 

3 by dividing— 

4 ‘‘(I) the total (after adjustment under para5 graph (3)(B)) of such individual’s surplus earnings 

6 (determined under clause (ii)) for such individual’s 

7 benefit computation years (determined under para8 graph (2)), by 

9 ‘‘(II) the number of months in those years. 

10 ‘‘(ii) For purposes of clause (i) and paragraph (3)(B), 

11 an individual’s surplus earnings for a benefit computation 

12 year are the total of such individual’s wages paid in and 

13 self-employment income credited to such benefit computa14 tion year, to the extent such total (before adjustment 

15 under paragraph (3)(B)) exceeds the contribution and 

16 benefit base for such year.’’. 

17 (B) CONFORMING AMENDMENT.—The 

18 heading for section 215(b) of such Act is 

19 amended by striking ‘‘Average Indexed Monthly 

20 Earnings’’ and inserting ‘‘Basic Average In21 dexed Monthly Earnings; Surplus Average In22 dexed Monthly Earnings’’. 

23 (3) ADJUSTMENT OF SURPLUS EARNINGS FOR

24 PURPOSES OF DETERMINING SURPLUS AIME.—SecVerDate Sep 11 2014 04:51 Jul 28, 2017 Jkt 069200 PO 00000 Frm 00014 Fmt 6652 Sfmt 6201 E:\BILLS\S1600.IS S1600

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1 tion 215(b)(3) of such Act (42 U.S.C. 415(b)(3)) is 

2 amended— 

3 (A) in subparagraph (A), by striking ‘‘sub4 paragraph (B)’’ and inserting ‘‘subparagraph 

5 (C)’’ and by inserting ‘‘and determination of 

6 basic average indexed monthly income’’ after 

7 ‘‘paragraph (2)’’; 

8 (B) by redesignating subparagraph (B) as 

9 subparagraph (C); and 

10 (C) by inserting after subparagraph (A) 

11 the following new subparagraph: 

12 ‘‘(B) For purposes of determining under paragraph 

13 (1)(B) an individual’s surplus average indexed monthly 

14 earnings, the individual’s surplus earnings (described in 

15 paragraph (2)(B)(ii)) for a benefit computation year shall 

16 be deemed to be equal to the product of— 

17 ‘‘(i) the individual’s surplus earnings for such 

18 year (as determined without regard to this subpara19 graph), and 

20 ‘‘(ii) the quotient described in subparagraph 

21 (A)(ii).’’. 

22 (c) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply with respect to individuals who ini24 tially become eligible (within the meaning of section 

25 215(a)(3)(B) of the Social Security Act) for old-age or disVerDate Sep 11 2014 04:51 Jul 28, 2017 Jkt 069200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\S1600.IS S1600

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1 ability insurance benefits under title II of the Social Secu2 rity Act, or who die (before becoming eligible for such ben3 efits), in any calendar year after 2017. 

Æ 


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