Professional Documents
Culture Documents
Executive Summary
In the following paper, we aim to The following papers aim is to
explain the distribution of the visits of elderly people to physicians.
The NBD models are based on a sample of the 1987 National Medical
Expenditure Survey1 that has 4,406 individual observations and was
taken in the United States.
I will not only look at the data set as a whole but I will compare
different segments to understand their differences, if any. The reader
will find if there is a major difference between the behavior of women
and menmale and female behavior, if the perceived health makes an
impact on the amount of visits and if having private insurance or
being part of the Medicaid program somehow influenced the
populations behavior.
Motivation
My main motivation is to understand one of the cost drivers for
insurance companies, which is the frequency of visits to physicians.
This dataset does not contain the cost of each visit or other type of
costs like hospitalization or emergency visits, therefore it is not
enough does not allow us to estimate lifetime cost of a customer but
will definitely prove or disprove my initial hypothesis that elder people
are used to visit physicians very often. I came to this hypothesis
based on two things: first,on the fact that elder people have more
time; second, elder people and, additionally, tend to get sick often,
hence making themthey are more propense to visit a physician.
Data Source
1 Deb, P. and P.K. Trivedi (1997) Demand for Medical Care by the
Elderly: A Finite Mixture Approach, Journal of Applied Econometrics,
12, 313-326.
1
For example, the range of the total sample went from 0 visits to 141
visits per year. Instead of trying to fit a model for that range I will
rather focus on the first 20 rows and add up the rest from 21 to 141.
600
500
400
300
Pa ents
200
0
3
6
9
12
15
18
21
24
27
30
33
36
40
43
46
50
54
58
62
68
110
100
Pa ents
200
100
0
0
10
12
14
16
18
20
physician and that the mean is 6.55 visits per year. [El 3.5% es en
cantidad o en probabilidad?]
Using the Method of Moments and Mean and Zeroes I obtained even
smaller r, 0.76 and 1.03 respectively. This implies that using this
analyses one could believe that elders are less likely to go to the
doctor than they actually are.
The table with the relevant outcomes of the model and both
histograms is in Exhibit 3.
Men vs. Women
In order to get a deeper understanding of the sample I decided to
analyze the differences between men and women. My initial
hypothesis is that men are less likely to go to the doctor than women,
I could even argue that there will be a spike at 0 for men and not for
women. After analyzing both scenarios I proved my hypothesis, as
men have a spike at 0 of 5.4% while womens model does not have
one. [El 5.4% es en cantidad o en probabilidad?]
Both r are similar: 1.29 for men and 1.33 for women, this means that
both do not visit a physician very often,; the difference, as pointed
before, is that 5.4% of men in our sample will never visit a physician.
In both analyses, but especially for Men, the histograms do not show
a good fit. As you can see in Exhibit 4 and 5, even though the P-Values
are large enough, the histograms do not show a good fit between the
actual and the expected number of persons.
When I used the Method of Moments and Means and Zeroes I saw how
the predicted r for men was lower than the one for women. In this
case, , my interpretation is that this is the way in which both methods
show the spike at cero for men.
r
Method of Moments
Meansand Zeroes
Men Women
0.62
0.89
0.92
1.06
1.9 that we got from the people with poor self-perceived health.
This means that they are less likely to go to a physician, but since
there is no spike at 0 all of them would be ok going while in the other
group we do have 4.6% that will never visit. In this case the Method of
Moments and the Means and Zeroes methods have r of 0.65 and 0.55
respectively, which are much smaller than the 1.12 we got with the
MLE. This will imply a much lower usage of physicians than the reality.
r
Method of Moments
Meansand Zeroes
Poor
0.98
1.51
Other
0.80
0.91
Excellent
0.65
0.55
Coverage
0.84
0.99
NoCoverage
0.42
0.74
Conclusions
Given the research we can conclude that elder people do not go as
often to see a physician as we would have expected to see a
physician, there is a total mean of 6.55 with a median of 4 [of visits
per year?]. Regarding the segments, all the hypothesis were proved
right. , eEven though men and women who visit physicians do it in a
similar way, there are 5.4% men who would not see a physician while
there is no spike at women.
Again, as we expected, there are people with poor self-perceived
health are who are more likely to see a physician than people with
excellent self-perceived health. Finally, because they are compose
approximately 85% of the sample it is hard to conclude anything
different about the covered people, while in the case of the uncovered
we know that they do not visit physicians as often as the rest of the
categories.
In general, even though there is not complete data to asses a thethe
elders insurance market, the reader could get an idea of how to
segment that market and what to expect from that segmentation.
[Haria referencia a las tablas del apendice en el texto o las incluiria
entre el texto. Si no son parte de las referencias, no deberan estar]
Exhibits
Exhibit 1, Data Set Sample
ofp ofnp opp opnp emr hosp numchron adldiff age black
1 5
2 1
3 13
4 16
5 3
6 17
7 9
8 3
9 1
10 0
0
0
0
0
0
0
0
0
0
0
0
2
0
5
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
2
3
1
0
0
0
0
0
0
1
0
3
1
0
0
0
0
0
0
2
2
4
2
2
5
0
0
0
0
0
0
1
1
1
1
0
0
0
0
6.9
7.4
6.6
7.6
7.9
6.6
7.5
8.7
7.3
7.8
yes
no
yes
no
no
no
no
no
no
no
sex
maried school
male
female
female
male
female
female
female
female
female
female
yes
yes
no
yes
yes
no
no
no
no
no
6
10
10
3
6
7
8
8
8
8
yes
no
no
no
no
no
no
no
no
no
yes
yes
no
yes
yes
no
yes
yes
yes
yes
no
no
yes
no
no
yes
no
no
no
no
region
hlth
other
other
other
other
other
other
midwest
midwest
midwest
midwest
other
other
poor
poor
other
poor
other
other
other
other
Descrpiction
number of physician office visits
number of nonphysician office visits
number of physician outpatient visits
number of nonphysician outpatient visits
number of years of education
familyincomein 10000\$
istheperson employed ?
number of emergencyroomvisits
number of hospitalizations
number of chronic conditions
Label
Descrpiction
adldiff
privins
medicaid
region
age
black
sex
maried
hlth
1.15
0.18
0.04
6.39
LRTP Value
NBDwithSpikeat0
1.31
0.20
0.52
6.55
3.46%
0.00
600
600
500
500
400
400
Pa ents
300
Pa ents
300
Expected
Expected
200
200
100
100
0
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
NBD
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
NBDwith Spikeat 0
NBD
r
Alpha
P Value
Mean
Spikeat 0
1.05
0.18
0.20
5.83
LRTP Value
NBDwithSpikeat0
1.29
0.20
0.79
6.45
5.40%
0.00
300
300
250
250
200
200
Pa ents
150
Pa ents
150
Expected
Expected
100
100
50
50
0
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
NBD
NBDwith Spikeat 0
1.22
0.19
0.40
6.42
LRTP Value
NBDwithSpikeat0
1.33
0.20
0.59
6.65
2.15%
0.05
350
350
300
300
250
250
200
Pa ents
150
Expected
200
100
100
50
50
Pa ents
150
Expected
0
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
NBD
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
NBDwith Spikeat 0
1.45
0.15
0.07
9.67
LRTP Value
NBDwithSpikeat0
1.90
0.18
0.64
10.56
4.60%
0.00
70
70
60
60
50
50
40
40
Pa ents
30
Pa ents
30
Expected
20
20
10
10
Expected
0
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
1 2 3 4 5 6 7 8 9 10111213141516171819202122
NBD
NBDwith Spikeat 0
1.20
0.20
0.16
6.00
LRTP Value
NBDwithSpikeat0
1.37
0.22
0.76
6.23
3.47%
0.00
500
500
450
450
400
400
350
350
300
300
250
Pa ents
250
Pa ents
200
Expected
200
Expected
150
150
100
100
50
50
0
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
NBD
NBDwith Spikeat 0
NBD
r
Alpha
P Value
Mean
Spikeat 0
1.12
0.31
0.19
3.61
LRTP Value
NBDwithSpikeat0
1.43
0.37
0.17
3.86
6.83%
0.19
80
80
70
70
60
60
50
50
Pa ents
40
30
Pa ents
40
Expected
Expected
30
20
20
10
10
0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 15 17 19 22 65
0 1 2 3 4 5 6 7 8 9 10 11 12 13 15 17 19 22 65
NBD
NBDwith Spikeat 0
1.26
0.19
0.15
6.63
LRTP Value
NBDwithSpikeat0
1.39
0.21
0.52
6.62
2.55%
0.00
450
450
400
400
350
350
300
300
250
Pa ents
200
Expected
250
150
150
100
100
50
50
Pa ents
200
Expected
0
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
NBD
0 1 2 3 4 5 6 7 8 9 101112131415161718192021
NBDwith Spikeat 0
NBD
r
Alpha
P Value
Mean
Spikeat 0
0.76
0.16
0.80
4.75
LRTP Value
NBDwithSpikeat0
0.94
0.18
0.89
5.22
7.05%
0.11
160
160
140
140
120
120
100
100
Pa ents
80
Expected
60
Expected
60
40
40
20
20
Pa ents
80
0
0 1 2 3 4 5 6 7 8 9 101112131415161719202122
NBD
1 2 3 4 5 6 7 8 9 1011121314151617181920212223
NBDwith Spikeat 0
12