article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Social Security COLA Limitation Act of 1994''. SEC. 2. LIMITATIONS ON COST-OF-LIVING ADJUSTMENTS. (a) In General.-- (1) Reduction in increases applied to higher primary insurance amounts.--Section 215(i)(2)(A) of the Social Security Act (42 U.S.C. 415(i)(2)(A)) is amended-- (A) by redesignating clause (iii) as clause (vii); and (B) in clause (ii), by striking ``The increase shall'' in the matter following subclause (III) and all that follows through ``Any increase'' and inserting the following: ``(iii) With respect to the amounts described in subclauses (I) and (III) of clause (ii), the increase shall be derived by multiplying each of such amounts (including each of those amounts as previously increased under this subparagraph) by the applicable increase percentage. ``(iv) With respect to primary insurance amounts described in subclause (II) of clause (ii), the increase shall be derived by-- ``(I) multiplying each of such amounts (including each such amount as previously increased under this subparagraph) by the applicable increase percentage, ``(II) determining among all such amounts as increased under subclause (I) the greatest primary insurance amount which is below the 20th percentile of such amounts, and ``(III) reducing each primary insurance amount as increased under subclause (I) to the sum of such amount determined as if there had been no reduction in such amount under this subclause in any preceding year and the amount of the increase under subclause (I) in the primary insurance amount described in subclause (II). ``(v) Any amount increased under clause (iii) or clause (iv) which is not a multiple of $0.10 shall be decreased to the next lower multiple of $0.10. ``(vi) Any increase''. (2) Conforming amendment.--The last sentence of section 215(a)(4) of such Act (42 U.S.C. 415(a)(4)) is amended, in subclause (I), by striking ``clause (iii) of subsection (i)(2)(A)'' and inserting ``clause (vii) of subsection (i)(2)(A)''. (b) Conforming Amendments To Maintain Current Levels of Cost-of- Living Adjustment Under Other Programs.-- (1) Supplemental security income for the aged, blind, and disabled.--Section 1617(a)(2) of the Social Security Act (42 U.S.C. 1382f(a)(2)) is amended by striking ``by the same percentage'' and all that follows through ``percentage,'' and inserting the following: ``by the applicable increase percentage (within the meaning of section 215(i)(1)(C)) used in determining the amount by which benefit amounts under title II are increased for such month''. (2) Supplementary medical insurance.--Section 1839(a)(3)(B) of such Act (42 U.S.C. 1395r(a)(3)(B)) is amended by striking ``by a percentage'' and all that follows through ``November 1'' and inserting the following: ``by the applicable increase percentage (within the meaning of section 215(i)(1)(C)) used in determining the amount by which benefit amounts under title II are increased for the month of December preceding the year of the promulgation''. (3) Certain veteran's benefits.--Section 3112 of title 38, United States Code, is amended-- (A) in subsection (a), by striking ``by the same percentage by which such benefit amounts are increased'' and inserting ``by the applicable increase percentage (within the meaning of section 215(i)(1)(C) of such Act) used in determining the amount by which such benefit amounts are increased''; and (B) in subsection (b)(1), by striking ``by the same percentage as the percentage by which such benefit amounts are increased'' and inserting ``by the applicable increase percentage (within the meaning of section 215(i)(1)(C) of such Act) used in determining the amount by which such benefit amounts are increased''. (4) Cost-of-living adjustments to limitations on benefits and contributions under qualified plans.--Subsection (d) of section 415 of the Internal Revenue Code of 1986 (relating to cost-of-living adjustments) is amended by striking ``section 215(i)(2)(A)'' and inserting ``section 215(i)(2)(A)(iii)''. (c) Amendment to Prior Applicable Law.--Section 215(i)(4) of the Social Security Act (42 U.S.C. 415(i)(4)) is amended by adding at the end the following new sentence: ``The Secretary shall provide by regulation for the continued application of this subsection as in effect in December 1978 as provided by the preceding provisions of this paragraph and the amendments referred to therein. Such regulations shall provide for the application of the amendments to the preceding provisions of this subsection made by section 2 of the Social Security Solvency Enhancement Act of 1994 so as to have the same effect on the corresponding provisions of this subsection as in effect in December 1978 and applicable in accordance with this paragraph.''. SEC. 3. EFFECTIVE DATE. The amendments made by this Act shall apply with respect to adjustments under section 215(i) of the Social Security Act effective with months after November 1994.
summary: Social Security COLA Limitation Act of 1994 - Amends title II (Old Age, Survivors and Disability Insurance) of the Social Security Act to establish a flat-rate cost-of-living adjustment. (Currently such adjustment is based on a beneficiary's actual benefit levels.)