The trend we noted last month in inflation for the non-labor inputs in health care continued in February. Beginning in January, we say higher than normal PPI for Medical Equipment and Supplies (2.51%); In Vitro Diagnostic Substance Manufacturing (10.06%), Surgical and Medical Instrument (1.94%) In February, the trend persisted in these categories and spread to Analytical Laboratory Instrument Manufacturing, up 5.97% in February.
Those are all some hefty increases for a sector that has enjoyed sub-1% inflation for years. Worse, this inflation is arriving late which means it is not likely to be baked into insurer contracts until 2023, at the earliest.
Emily Evans
Managing Director – Health Policy
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