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The Stata Journal
Volume 15 Number 3: pp. 698-711



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Estimation of mean health care costs and incremental cost-effectiveness ratios with possibly censored data

Shuai Chen
Department of Biostatistics and Medical Informatics
University of Wisconsin–Madison
Madison, WI
[email protected]
Jennifer Rolfes
T-Mobile
Seattle, WA
Hongwei Zhao
Department of Epidemiology and Biostatistics
School of Rural Public Health
Texas A&M Health Science Center
College Station, TX
Abstract.  In this article, we describe the hcost program for estimating mean health care costs and incremental cost-effectiveness ratios with possibly censored data. hcost estimates the mean survival time and the mean costs, as well as their variances and covariance, for a given time horizon. If the group variable is specified, hcost will report the differences between two groups, as well as the incremental cost-effectiveness ratio and its confidence interval (optional). hcost can estimate the mean costs using two methods corresponding to different types of data: the Bang and Tsiatis (2000, Biometrika 87: 329–343) estimator using only the total costs or the Zhao and Tian (2001, Biometrics 57: 1002–1008) estimator when cost-history data are available. The hcost program can also be used to specify the annual discounting rates for survival time and costs.
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