Total Offset and Medical Net Discount Rates: 1981–2012

Medical net discount rates (MNDRs) are calculated using monthly data for the period 1981:01–2012:06 based on the medical consumer price index and annual percentage yields based on 3-month, 6-month and 1-year U.S. Treasury Securities. Stationarity is tested for each series and the results of time-series analytics through 2000:05 are compared to previously published results (Ewing, Payne and Piette, 2001) that omitted Treasury Securities of shortest duration. The various series are extended to 2012:06 and the time series properties are examined. Although the results are mixed, they are more supportive of total offset (i.e., a zero MNDR) than previously published research findings have been.