In 2017, healthcare accounted for 17.9 percent of U.S. Gross Domestic Product (GDP). Because healthcare is such a large sector, it is important that we measure its output and prices correctly. If published healthcare inflation rates are too high, then measured real output growth is too low and consumers are getting more for their healthcare dollar than the published estimates suggest. Similarly, if published healthcare inflation rates are too low, measured real output growth would be too high.
The Bureau of Labor Statistics (BLS) is committed to producing and publishing the most accurate medical price indexes possible. BLS has constructed research disease-based price indexes to find a better way to estimate inflation, real medical output, and real consumption. Disease-based price indexes provide an alternative measure of medical care price change and are primarily used by researchers. The BLS approach to producing research disease-based price indexes is a prime example of using data from multiple sources to produce new blended statistics, using data from the Consumer Price Index and Producer Price Index from BLS, and the Medical Expenditure Panel Survey (MEPS) produced by the Agency for Healthcare Research and Quality (AHRQ).
Disease-based prices indexes are in their nascent stages and are calculated outside of the official production system. We regard them as research because we still need to learn more from the research that we and others will conduct. The publicly available data that we use to calculate the average medical utilization by disease can have relatively small sample sizes at the level of a specific disease. This can create substantial year-to-year variation in the indexes. As we learn and improve these indexes, BLS hopes that they will greatly enhance our understanding of the healthcare sector.
Disease-based price indexes are published monthly following the release of Consumer Price Index (CPI) and Producer Price Index (PPI) data. See the BLS Release Calendar for publication dates. Data are available starting with January 1999.
Disease-based price indexes are available on the Price and Index Number Research homepage.
Additional information is available in Experimental Disease Based Price Indexes journal article and in the Producing disease-based price indexes Monthly Labor Review article. In addition, the Bureau of Economic Analysis has extensive information on its work on the Health Care Satellite Account on its website, including alternative approaches to development of disease-based price indexes.
Last Modified Date: July 17, 2020