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Correcting for bias when estimating the cost of hospital‐acquired infection: an analysis of lower respiratory tract infections in non‐surgical patients
Author(s) -
Graves Nicholas,
Weinhold Diana,
Roberts Jennifer A.
Publication year - 2005
Publication title -
health economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.55
H-Index - 109
eISSN - 1099-1050
pISSN - 1057-9230
DOI - 10.1002/hec.967
Subject(s) - endogeneity , instrumental variable , estimation , medicine , respiratory tract infections , intensive care medicine , economics , econometrics , respiratory system , management
Hospital acquired infections (HAI) are costly but many are avoidable. Evaluating prevention programmes requires data on their costs and benefits. Estimating the actual costs of HAI (a measure of the cost savings due to prevention) is difficult as HAI changes cost by extending patient length of stay, yet, length of stay is a major risk factor for HAI. This endogeneity bias can confound attempts to measure accurately the cost of HAI. We propose a two‐stage instrumental variables estimation strategy that explicitly controls for the endogeneity between risk of HAI and length of stay. We find that a 10% reduction in ex ante risk of HAI results in an expected savings of £693 ($US 984). Copyright © 2005 John Wiley & Sons, Ltd.