More on the history of health care cost inflation

TheIncidentalEconomist serves up a banquet.  Austin Frakt emails me (do not take him to be endorsing the stated view, which is speculative; there were further emails):

One hypothesis is that health care costs steadied in the 1980s as care was shifted from inpatient to outpatient settings. It's possible that outpatient surgeries were both more profitable to providers and less costly to payers. The graph at the following link doesn't quite go back far enough but it is plausible that this shift began in the early 1980s. Note that the shift fully played out by 2000, though perhaps the bulk of cost savings was already wrung out of the system in the first few years or was overwhelmed by other factors:

Aaron Carroll looks at outpatient care and questions whether that was the key shift.  Carroll also redoes the chart.  Here is Austin's final statement.


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