ABSTRACT
Semi-continuous data characterized by an excessive proportion of zeros and right-skewed continuous positive values appear frequently in medical research. One example would be the pharmaceutical expenditure (PE) data for which a substantial proportion of subjects investigated may report zero. Two-part mixed-effects models have been developed to analyse clustered measures of semi-continuous data from multilevel studies. In this study, we propose a new flexible two-part mixed-effects model with skew distributions for nested semi-continuous cost data under the framework of a Bayesian approach. The proposed model specification consists of two mixed-effects models linked by the correlated random effects: Part I) a model on the occurrence of positive values using a generalized logistic mixed model; and Part II) a model on the magnitude of positive values using a linear mixed model where the model errors follow skew distributions including beta-prime (BP). The proposed method is illustrated with pharmaceutical expenditure data from a multilevel observational study and the analytic results are reported by comparing potential models under different skew distributions. Simulation studies are conducted to assess the performance of the proposed model. The DIC3, LPML, WAIC, and LOO as the Bayesian model selection criteria and measures of divergence used to compare the models.