Medical care inflation: what the CPI measures, nationally and by city

What is inside the medical care index

The BLS medical care index has two parts. Medical care commodities are prescription drugs, nonprescription drugs and medical equipment and supplies: 18 % of the medical index in December 2025 weights. Medical care services are the other 82 %: professional services (physicians, dentists, eye care and other professionals), hospital and related services (including emergency room visits, nursing homes and adult day care) and health insurance.

Why the weight is small

Health spending is a large share of the U.S. economy, yet medical care is under a tenth of the CPI basket. The reason is the definition. The CPI weights each item by what consumers spend themselves, and for medical care the BLS counts payments made directly to providers and pharmacies plus the health insurance premiums households pay, including Medicare Part B, Medicare Advantage (Part C) and Part D. The share of a premium an employer pays, and care funded by taxes such as Medicare Part A and Medicaid, are not out-of-pocket and do not enter the weight. The BLS notes that this is why medical care has a smaller share in the CPI than in GDP, which counts those payments.

The price, however, is the full price. For a physician visit, the BLS takes the patient's copay and the insurer's payment together: its own example is a $20 copay plus an $80 insurance payment, a $100 visit. A rise in what insurers pay doctors shows in the index even if your copay stays the same.

How health insurance is priced

A premium mixes two things: the cost of the care the insurer pays for, already in the other medical indexes, and the insurer's own cost of running the policy. To avoid counting care twice, the BLS prices health insurance indirectly, by the retained earnings method: the part of premiums the insurer keeps after paying benefits, used for administration and profit. Its index follows the ratio of retained earnings to benefits, computed from insurers' financial data over trailing 12 months. It does not follow the premium on your pay stub, and its weight, 0.89 % of the CPI-U, is about 11 % of medical care. If your premium rose 9 %, the calculator cannot tell you whether that is normal: the health insurance index measures something else.

Medical care by metro

Metro medical indexes move far more than the national one. A local index rests on a small sample of physicians, hospitals and pharmacies, and the BLS warns that local indexes are more volatile than the U.S. city average. Before quoting a metro rate in a negotiation, check the next release or two.

The long view

On annual averages, U.S. medical care prices rose most in 2002 in this file, 4.7 %, and least in 2023, 0.5 %. Over long periods medical care has outpaced the overall index: $100 of medical care at 2000 average prices costs $227.63 in September 2026, against $195.67 for the whole basket. A $1,200 medical expense at 2020 prices corresponds to $1,372.93 today. In the September 2026 release, seasonally adjusted, the medical care index rose 0.1 % over the month, with hospital services up 0.7 % and prescription drugs down 1.2 %.

Medical care and the missing October 2025

The medical care index has no value for October 2025, like every index on this site: the BLS collected no prices during the lapse in appropriations. Nationally it went from 584.858 in September 2025 to 585.213 in November. For a bill dated October 2025, the calculator uses September and says so.

Using the index for your own costs

The medical care CPI answers one question: how much the prices of a fixed set of medical goods and services changed, whoever pays them. Your own costs also depend on your plan, your deductible, the drugs you take and how often you see a doctor, none of which the index follows. For a budget, it gives a fair order of magnitude; for a reimbursement clause, the all items index is the usual reference. The spending group page compares medical care with the other groups, and the Social Security COLA page explains why the COLA follows the CPI-W, not a medical index.