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Estimates of use and costs of behavioural health care: a comparison of standard and finite mixture models

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Author Info

  • Partha Deb

    (Department of Economics, Indiana University-Purdue University Indianapolis, Indianapolis, USA)

  • Ann M. Holmes

    (School of Public and Environmental Affairs, Indiana University-Purdue University Indianapolis, Indianapolis, USA)

Abstract

Estimates of health care demand are known to depend on the empirical specification used in the analysis. In this paper, an innovative specification, the finite mixture model (FMM), is employed to estimate the utilization of and expenditures on behavioural health care. Unlike standard specifications, the FMM has the ability to distinguish between distinct classes of users of behavioural health care (e.g. the 'worried well' and the severely mentally ill). This new model is tested against standard empirical specifications using data from the National Medical Expenditure Survey. Using common risk stratifiers, estimates of utilization and costs are generated with each specification. It is found that the FMM provides a much better fit of both expenditure and utilization data than standard specifications, particularly among high intensity users that standard models have been unable to represent adequately. Furthermore, the results provide preliminary evidence that there are (at least) two distinct groups of users of behavioural health care. The empirical advantages of the FMM translate into superior estimates of mean costs and utilization that have widespread application in rate-setting exercises. Copyright © 2000 John Wiley & Sons, Ltd.

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Bibliographic Info

Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 9 (2000)
Issue (Month): 6 ()
Pages: 475-489

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Handle: RePEc:wly:hlthec:v:9:y:2000:i:6:p:475-489

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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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Cited by:
  1. Monika Sander, 2008. "Is There Migration-Related Inequity in Access to or in the Utilisation of Health Care in Germany?," SOEPpapers on Multidisciplinary Panel Data Research 147, DIW Berlin, The German Socio-Economic Panel (SOEP).
  2. Teresa Bago d'Uva, 2006. "Latent class models for utilisation of health care," Health Economics, John Wiley & Sons, Ltd., vol. 15(4), pages 329-343.
  3. Sergi Jiménez-Martín & José Labeaga & Maite Martínez-Granado, 2004. "An empirical analysis of the demand for physician services across the European Union," The European Journal of Health Economics, Springer, vol. 5(2), pages 150-165, May.
  4. Bago d'Uva, Teresa & Jones, Andrew M., 2009. "Health care utilisation in Europe: New evidence from the ECHP," Journal of Health Economics, Elsevier, vol. 28(2), pages 265-279, March.
  5. Teresa Bago d'Uva, 2005. "Latent class models for use of primary care: evidence from a British panel," Health Economics, John Wiley & Sons, Ltd., vol. 14(9), pages 873-892.
  6. Majo, M.C. & Soest, A.H.O. van, 2011. "The Fixed-Effects Zero-Inflated Poisson Model with an Application to Health Care Utilization," Discussion Paper 2011-083, Tilburg University, Center for Economic Research.
  7. Óscar Lourenço & Carlota Quintal & Pedro Lopes Ferreira & Pedro Pita Barros, 2007. "A equidade na utilização de cuidados de saúde em Portugal: Uma avaliação baseada em modelos de contagem," Notas Económicas, Faculdade de Economia, Universidade de Coimbra, issue 25, pages 6-26, June.
  8. Michael Creel, 2002. "Hausman Tests for Inefficient Estimators: Application to Demand for Health Care Service (revised)," UFAE and IAE Working Papers 509.02, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  9. Sergi Jiménez-Mart�n & José M. Labeaga & Maite Mart�nez-Granado, 2002. "Latent class versus two-part models in the demand for physician services across the European Union," Health Economics, John Wiley & Sons, Ltd., vol. 11(4), pages 301-321.
  10. �scar D. Lourenço & Pedro L. Ferreira, 2005. "Utilization of public health centres in Portugal: effect of time costs and other determinants. Finite mixture models applied to truncated samples," Health Economics, John Wiley & Sons, Ltd., vol. 14(9), pages 939-953.
  11. Erik Schokkaert & Tom van Ourti & Diane De Grave & Ann Lecluyse & Carine Van De Voorde, 2007. "Supplemental health insurance and equality of access in Belgium," Center for Economic Studies - Discussion papers ces0729, Katholieke Universiteit Leuven, Centrum voor Economische Studiën.
  12. Jones, A.M, 2010. "Models For Health Care," Health, Econometrics and Data Group (HEDG) Working Papers 10/01, HEDG, c/o Department of Economics, University of York.

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