Why are medical costs rising so rapidly? What are the factors involved that influence those costs? Does inflation affect health care costs? Can anything be done? The solutions to these complex issues are not clearly understood. It is clear, however, that the resolutions to these questions must be found quickly. If the causes of rising medical care costs are not promptly diagnosed and treated, we may find our economic health to be in critical condition. This paper attempts to better understand the reasons for increasing health care costs. The role that inflation plays relative to health care costs is investigated.