TY  - JOUR
AU  - Cutler,David M.
AU  - McClellan,Mark
AU  - Newhouse,Joseph P.
AU  - Remler,Dahlia
TI  - Are Medical Prices Declining?
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 5750
PY  - 1996
Y2  - September 1996
UR  - http://www.nber.org/papers/w5750
L1  - http://www.nber.org/papers/w5750.pdf
N1  - Author contact info:
David M. Cutler
Department of Economics
Harvard University
1875 Cambridge Street
Cambridge, MA  02138
Tel: 617/496-5216
Fax: 617/496-8951
E-Mail: dcutler@harvard.edu

Mark B. McClellan
Director, Engelberg Center for Health Care Reform
Senior Fellow, Economic Studies
Leonard .D. Schaeffer Director's Chair in
Health Policy ,The Brookings Institution
1775 Massachusetts avenue, N.W.
Washington, DC 20036
Tel: (202) 741-6567
Fax: NA
E-Mail: mmcclellan@brookings.edu

Joseph P. Newhouse
Division of Health Policy  Research and Education
Harvard University
180 Longwood Avenue
Boston, MA  02115-5899
Tel: 617/432-1325
Fax: 617/432-3503
E-Mail: newhouse@hcp.med.harvard.edu

Dahlia K. Remler
School of Public Affairs
Baruch College
City University of New York
One Bernard Baruch Way
Box D-901
New York, NY 10010
Tel: 646/660-6725
Fax: 646/660-6701
E-Mail: Dahlia.Remler@baruch.cuny.edu
M2  - featured in NBER digest on 1997-02-01
AB  - 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.
ER  -