A Note on Health Care Inflation

This study seeks to identify the key factors that influence the inflation rate of health care services. The time series analysis covers the period from 1960-1994. The results provide insights into both demand-side and supply-side determinants of this inflation rate. The health care inflation rate is found to be an increasing function of the over age 65 population, malpractice insurance premiums, and the frequency of high-tech testing, while being a decreasing function of the number of physicians per 100,000 population.