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Market Basket Research and Information

Note: All data and Web pages are accessible for download – see the links in the Downloads section below.

Market Basket Information

Definitions and general information.

  • In an effort to provide greater transparency of how CMS market baskets are constructed, we are posting three illustrative documents as described in the CMS Proposed Rule:  "Medicare Program; Proposed Changes to the Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and Fiscal Year 2010 Rates and to the Long-Term Care Hospital Prospective Payment System and Rate Year 2010 Rates."  These electronic files demonstrate:
    • How the detailed cost weights for the proposed 2006-based IPPS operating market basket are determined using the 2002 Benchmark Input-Output data
    • How vintage weights are calculated for the 2006-based Capital Input Price Index
    • How vintage weights are applied to raw price proxies to calculate a vintage-weighted price proxy for the 2006-based Capital Input Price Index

Market Basket Research

Research projects are undertaken by the Centers for Medicare & Medicaid Services' (CMS) Office of the Actuary (OACT) staff on a variety of market basket topics, including index development and construction, theoretical update frameworks, and wage studies.

  • OACT research papers
    • Discussion of alternative weighting of the hospital market basket input price index
    • Conceptual paper on an update framework for Skilled Nursing Facilities
    • Global Insight/DRI-WEFA study on hospital wages (This paper is copyright 2002 by Global Insight, Inc. All rights to these data are retained by Global Insight, Inc. and may not be copied or reused without their permission.)
    • CMS development of a Market Basket for End Stage Renal Disease for the 2003 Report to Congress
    • Research on the development of specific Market Baskets for Excluded-type Hospitals
  • "Health Care Financing Review" articles (U.S. Department of Health and Human Services, Centers for Medicare & Medicaid Services, Office of Research, Development, and Information, Baltimore, MD)
    • National Hospital Input Price Index, Summer 1979, volume 1, number 1, page 37
    • The Medicare Economic Index: Its Background and Beginnings, September 1981, volume 3, number 1, Page 137
    • Regional Hospital Input Price Indexes, December 1981, volume 3, number 2, page 25
    • A Framework for Analyzing Prospective Payment System Rate-Increase Factor, Summer 1985, volume 6, number 4, page 135
    • Update on Provider Input Price Indexes, Spring 1988, volume 9, number 3, page 89
    • Does One National Prospective Payment System Market Basket Make Sense? Winter 1988, volume 10, number 2, page 25
    • Measuring Hospital Input Price Increases: The Rebased Hospital Market Basket, Spring 1991, volume 12, number 3, page 1
    • Measuring Input Prices for Physicians: The Revised Medicare Economic Index, Summer 1991, volume 12, number 4, page 61