{"title":"Are Medical Prices Declining?","authors":"D. Cutler, M. Mcclellan, J. Newhouse, D. Remler","doi":"10.3386/W5750","DOIUrl":"https://doi.org/10.3386/W5750","url":null,"abstract":"We address long-standing problems in measuring health care prices by estimating two medical care price indices. The first, a Service Price Index, prices specific medical services, as does the current CPI. The second, a Cost of Living Index, measures the net valuation of treating a health problem. We apply these indices to heart attack treatment between 1983 and 1994. Because of technological change and increasing price discounts, the current CPI overstates a chain-weighted price index by three percentage points annually. For plausible values of an additional life-year, the real Cost of Living Index fell about 1 percent annually.","PeriodicalId":393567,"journal":{"name":"Alfred P. Sloan: Empirical Economic Research Enablers (Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1996-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129604966","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Auditing the Producer Price Index: Micro Evidence from Prescription Pharmaceutical Preparations","authors":"E. Berndt, Z. Griliches, J. Rosett","doi":"10.1080/07350015.1993.10509953","DOIUrl":"https://doi.org/10.1080/07350015.1993.10509953","url":null,"abstract":"From January 1984 through December 1989, the Bureau of Labor Statistics (BLS) price index for prescription pharmaceuticals grew at 9.09% per year. Using BLS-type Laspeyres index procedures with monthly price and quantity data on all prescription pharmaceuticals sold by four U.S. pharmaceutical manufacturers accounting for 24% of industry domestic sales, we find that the four-company index increases at 6.68% per year. When we employ a Divisia price index with smoothed weights incorporating new goods, the index grows 6.03% per year. Why does the BLS index grow 50% more rapidly than the Divisia index? That mystery is the focal point of our article.","PeriodicalId":393567,"journal":{"name":"Alfred P. Sloan: Empirical Economic Research Enablers (Topic)","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1992-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129310876","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}