School of Economics seminars are the main academic seminar series held on a Friday. These seminars are presented by guest researchers and enable School of Economics academics to network with other academics from around Australia and internationally.

Modelling multiple modes in health outcome distributions: a panel analysis of cognitive impairment and health care utilisation

Fri 12 May 2017 3:30pm4:30pm

Evaluation of health care utilization is prominent in the economics literature, generally concentrating on the impact of certain health conditions on resource use, using varied sources of individual level self-reported data. However, the important additional impact of cognitive impairment has not yet been explored. We now propose a model that assesses the impact of word recall, a standard validated measure of cognitive status, on health care utilisation. The use of self-reported counts of visits to general practitioners, common in the literature, leads to a response variable that is adversely affected by both recall bias and differing reporting behaviours. Using the Survey of Health, Ageing and Retirement in Europe data, in separate models for men and women, we disentangle these various effects. We develop an approach that simultaneously takes into account the count nature of the data, recall bias and reporting behaviours, unobserved heterogeneity, and the unique role of cognitive impairment in all of these processes. Our model also introduces an individual specific random parameter, allowing us to identify the effects by individuals. Interestingly, we demonstrate that the effect of cognitive impairment is relatively constant over age.