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Use of Econometric Models to Estimate Expenditure Shares
Author(s) -
Trogdon Justin G.,
Finkelstein Eric A.,
Hoerger Thomas J.
Publication year - 2008
Publication title -
health services research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.706
H-Index - 121
eISSN - 1475-6773
pISSN - 0017-9124
DOI - 10.1111/j.1475-6773.2007.00827.x
Subject(s) - econometrics , econometric model , economics , statistics , computer science , mathematics
Objective. To investigate the use of regression models to calculate disease‐specific shares of medical expenditures. Data Sources/Study Setting. Medical Expenditure Panel Survey (MEPS), 2000–2003. Study Design. Theoretical investigation and secondary data analysis. Data Collection/Extraction Methods. Condition files used to define the presence of 10 medical conditions. Principal Findings. Incremental effects of conditions on expenditures, expressed as a fraction of total expenditures, cannot generally be interpreted as shares. When the presence of one condition increases treatment costs for another condition, summing condition‐specific shares leads to double‐counting of expenditures. Conclusions. Condition‐specific shares generated from multiplicative models should not be summed. We provide an algorithm that allows estimates based on these models to be interpreted as shares and summed across conditions.