Inverse probability weighted estimation of social tariffs: an illustration using the SF-6D value sets

This paper presents a novel approach to model health state valuations using inverse probability weighting techniques. Our approach makes no assumption on the distribution of health state values, accommodates covariates in a flexible way, eschews parametric assumptions on the relationship between the outcome and the covariates, allows for an undetermined amount of heterogeneity in the estimates and it formally tests and corrects for sample selection biases. The proposed model is semi-parametrically estimated and it is illustrated with health state valuation data collected for Spain using the SF-6D descriptive system. Estimation results indicate that the standard regression model underestimates the utility loss that the Spanish general population assigns to departures from full health, particularly so for severe departures.