Modelling Household Expenditure on Health Care in Greece
Health expenditure data are known to be afflicted by restricted range, zero values, skewness and kurtosis. Several methods for modelling such data have been suggested in the literature to cope with these problems. This paper compares the performance of several alternative estimators, including two-part models and generalized linear models. The dependent variable is household, not individual, expenditure on health care in Greece, a country where out-of-pocket health expenditure is higher than anywhere else in the European Union, whether as a proportion of GDP, as a share of all health spending, or in per capita terms. To facilitate comparison of model performance, household health expenditure is examined in two different specifications; expenditure on all health care (where zero values are rare) and expenditure on hospital services alone (where zero values are common). Three of the estimators performed almost equally well in terms of mean square error and mean absolute prediction error; a modified two-part model with non-linear least squares in the second part, a constant-variance generalized linear model, and a varianceproportional- to-mean generalized linear model. The findings suggest that no estimator is best under all circumstances, while most alternative estimators produce similar results. The paper concludes by discussing implications for further research.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Anirban Basu & Willard G. Manning & John Mullahy, 2004. "Comparing alternative models: log vs Cox proportional hazard?," Health Economics, John Wiley & Sons, Ltd., vol. 13(8), pages 749-765.
- Blough, David K. & Madden, Carolyn W. & Hornbrook, Mark C., 1999. "Modeling risk using generalized linear models," Journal of Health Economics, Elsevier, vol. 18(2), pages 153-171, April.
- Deb, Partha & Trivedi, Pravin K., 2002. "The structure of demand for health care: latent class versus two-part models," Journal of Health Economics, Elsevier, vol. 21(4), pages 601-625, July.
- Andrew M. Jones, 2012.
The New Palgrave Dictionary of Economics,
- Cantoni, Eva & Ronchetti, Elvezio, 2006. "A robust approach for skewed and heavy-tailed outcomes in the analysis of health care expenditures," Journal of Health Economics, Elsevier, vol. 25(2), pages 198-213, March.
- Elias Mossialos & Sara Allin & Konstantina Davaki, 2005. "Analysing the Greek health system: a tale of fragmentation and inertia," Health Economics, John Wiley & Sons, Ltd., vol. 14(S1), pages S151-S168.
- Willard G. Manning & John Mullahy, 1999.
"Estimating Log Models: To Transform or Not to Transform?,"
NBER Technical Working Papers
0246, National Bureau of Economic Research, Inc.
- Manning, Willard G. & Mullahy, John, 2001. "Estimating log models: to transform or not to transform?," Journal of Health Economics, Elsevier, vol. 20(4), pages 461-494, July.
- Manning, Willard G, et al, 1987. "Health Insurance and the Demand for Medical Care: Evidence from a Randomized Experiment," American Economic Review, American Economic Association, vol. 77(3), pages 251-77, June.
- Willard G. Manning & Anirban Basu & John Mullahy, 2003.
"Generalized Modeling Approaches to Risk Adjustment of Skewed Outcomes Data,"
NBER Technical Working Papers
0293, National Bureau of Economic Research, Inc.
- Manning, Willard G. & Basu, Anirban & Mullahy, John, 2005. "Generalized modeling approaches to risk adjustment of skewed outcomes data," Journal of Health Economics, Elsevier, vol. 24(3), pages 465-488, May.
- Willard G. Manning & Anirban Basu & John Mullahy, 2003. "Generalized Modeling Approaches to Risk Adjustment of Skewed Outcomes Data," Working Papers 0313, Harris School of Public Policy Studies, University of Chicago.
- Buntin, Melinda Beeuwkes & Zaslavsky, Alan M., 2004. "Too much ado about two-part models and transformation?: Comparing methods of modeling Medicare expenditures," Journal of Health Economics, Elsevier, vol. 23(3), pages 525-542, May.
- Manning, Willard G., 1998. "The logged dependent variable, heteroscedasticity, and the retransformation problem," Journal of Health Economics, Elsevier, vol. 17(3), pages 283-295, June.
When requesting a correction, please mention this item's handle: RePEc:bog:wpaper:68. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christina Tsochatzi)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.