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In recent years, healthcare service utilization has undergone several shifts, having potentially important implications for the cost of medical care. For example, while inpatient care has been declining, surgeries at outpatient departments and other venues not requiring a costly overnight stay have been rising.2 These shifts in medical care are not reflected in official price indexes reported by the Bureau of Labor Statistics (BLS). The official price indexes capture the provider prices for a fixed basket of goods or services, which do not allow for shifts in treatment.3 This type of index is referred to as a "service price index" or SPI in the literature. Alternative indexes have been proposed that would capture the effect of service shifts on costs (Schultze and Mackie (2002)). In fact, many health economists have advocated an index that tracks the actual expenditures associated with an episode of care, without holding the service mix fixed. For example, if depression is now treated with drug therapy, rather than more expensive talk therapy, the alternative index figures would show cost reductions associated with this switch. This alternative index is referred to as a "medical care expenditure index," or MCE.