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Inferences In Censored Cost Regression Models With Empirical Likelihood, Xiao-Hua Zhou, Gengsheng Qin, Huazhen Lin, Gang Li

UW Biostatistics Working Paper Series

In many studies of health economics, we are interested in the expected total cost over a certain period for a patient with given characteristics. Problems can arise if cost estimation models do not account for distributional aspects of costs. Two such problems are 1) the skewed nature of the data and 2) censored observations. In this paper we propose an empirical likelihood (EL) method for constructing a confidence region for the vector of regression parameters and a confidence interval for the expected total cost of a patient with the given covariates. We show that this new method has good theoretical …