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Raw data: Medical inflation has plummeted over the past three years

Published on 12 Comments on Raw data: Medical inflation has plummeted over the past three years

It's been a while since we looked at rising medical costs. Here's the latest:

Medical costs surged in the early '80s, but steadily came down over the next 20 years. Since 2000, medical inflation has been fairly well controlled, averaging about one percentage point higher than overall inflation.

More recently, medical care wasn't affected by the post-pandemic surge in prices. So medical inflation has been well under the overall rate of inflation. As a result, net medical inflation over the past dozen years has matched overall inflation exactly. They're both up 39% since 2012.

12 thoughts on “Raw data: Medical inflation has plummeted over the past three years”

    1. Austin

      Vermont covers basically everybody so patients experience long wait times for medical care.

      Other redder states don’t cover large swathes of their population, so patients that don’t have coverage don’t bother seeking medical care because they can’t afford the bills, which perversely means the people with insurance don’t experience long lines… except at the one place where the medical system has to treat everyone regardless of ability to pay: the ER.

      If you restrict demand (using prices or the law) for any given service or product, supply can appear abundant, even as loads of actual people go without the service or product as all. North Korea has both millions of starving people and no lines in Pyongyang’s supermarkets, where every shelf is fully stocked with food. This happens because 95% of the population is forbidden to even enter Pyongyang, and 4ish% of the 5% that do live there can’t afford the prices.

      1. Austin

        It occurred to me: this also explains why the few tourists that do go to Pyongyang report having great times there… as long as they follow the rules of course - RIP Otto Warmbier. What other major metropolitan area of a million-plus can boast no queues at all for restaurants or in stores or on the roads?! Amazing what extreme poverty and repression can do to improve the lived experience of relatively rich people! (To be clear, any western tourist in NK is by definition thousands of times richer than a random local resident… they might as well be literal millionaires as they walk around that city with their minders.)

        1. MikeTheMathGuy

          I have a close relative who has lived in the UK for the past 12 years, and according to her... it's complicated. I think conventional wisdom is that getting in for primary care is quick, but seeing a specialist takes forever; that has also been her personal experience. I once needed minor primary care while visiting her (asthma flare-up), and got an appointment within 3 hours after one phone call, with zero paperwork. Here's a link on one aspect of the question:
          https://www.bbc.com/news/health-65275367

        2. elcste

          I'm a unreformed Anglophile, but the NHS is not the best way to do health care. Sample BBC headline from 10 Sep 2024:

          Plan to hit 18-week NHS wait target 'set to fail'

          The government’s plan to tackle the hospital backlog in England will fail without a fundamental reform in how services work, health leaders say.

          Labour aims to increase the number of appointments and operations done each week by 40,000, to help hit the 18-week waiting time target.

          https://www.bbc.com/news/articles/crlr7d4wl7go

  3. middleoftheroaddem

    If you start at a VERY high level (EG US medical prices in 2000) then a slowing in relative inflation, while important, is not that consequential. Its similar to the very expensive jewelry store: a 20% off sale may not be a real bargain.

  4. Jerry O'Brien

    Thanks, Joe Biden! (But you should have mounted a campaign from 2021 onward, not for your reelection, but to sell America on your party.)

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