Regression methods for cost-effectiveness analysis with censored data

A system of seemingly unrelated regression equations is proposed for prognostic factor adjustment and subgroup analysis when comparing two groups in a cost-effectiveness analysis with censored data. Because of the induced dependent censoring on costs and quality-adjusted survival, inverse probability weighting is employed for parameter estimation. The method is illustrated with data from two recent examples using both survival time and quality-adjusted survival time as the measures of effectiveness.