ANALYSING LONGITUDINAL CLAIMS COST DATA : A ZERO-AUGMENTED GAMMA MIXED REGRESSION APPROACH(Statistical Models for Biomedical Research)

This paper presents a zero-augmented gamma mixed regression model to analyse longitudinal data with many zeros. The objective of occupational health is to reduce the injury incidence and the mean claims cost once injured. However, the population-based claims cost data often contain many zero observations (no claim). The empirical distribution thus comprises a point mass at zero mixed with a non-degenerate parametric component. The likelihood function can be factorised into two orthogonal components, corresponding to the effects of covariates on the claim incidence and the magnitude of claims, conditional on claims being made. Random effects are incorporated into the respective linear predictor to account for correlation between observations from the same individual. The mixed regression model is applied to evaluate the effectiveness of an occupational intervention program.