Methods to Estimate Disease-Based Price Indexes and Their Variances

• Activity Number: 660
• Type: Contributed
• Date/Time: Thursday, August 4, 2011 : 10:30 AM to 12:20 PM
• Sponsor: Section on Government Statistics
• Author(s): Ralph Bradley*+
• Companies: Bureau of Labor Statistics
• Keywords: delta method ; multiple imputation

Abstract

Many medical experts have recommended to US statistical agencies that their current service price indexes for medical care be replaced by disease based price indexes. To date, several studies have computed historical disease based price indexes. Yet, most of them use expensive claims data, and implementing their methods into production would not only disrupt current price index programs, but would be costly. This study derives disease based price indexes and variance estimators using two existing surveys that one can access at no cost. Thus, these methods would not disrupt existing programs and would not be costly to implement. However, these two surveys are generated by two different agencies, and the resulting disease based price indexes are non linear functions of variables that come from the two surveys. This study shows that the delta method can produce consistent variance estimators.