4.3 Keeping an Eye on Healthcare Costs: The D2Hawkeye Story | 4.3 Keeping an Eye on Healthcare Costs: The D2Hawkeye Story | 4 Trees | The Analytics Edge | Sloan School of Management

<Video 3: The Variables
4.3.1Video 1: The Story of D2Hawkeye
4.3.2Quick Question
4.3.3Video 2: Claims Data
4.3.4Quick Question
4.3.5Video 3: The Variables
4.3.6Quick Question
4.3.7Video 4: Error Measures
4.3.8Quick Question
4.3.9Video 5: CART to Predict Cost
4.3.10Quick Question
4.3.11Video 6: Claims Data in R
4.3.12Quick Question
4.3.13Video 7: Baseline Method and Penalty Matrix
4.3.14Quick Question
4.3.15Video 8: Predicting Healthcare Cost in R
4.3.16Quick Question
4.3.17Video 9: Results
>Video 4: Error Measures

Quick Question

While we don't have all of the data we would ideally like to have in this problem (like test results), we can define new variables using the data we do have. Which of the following were new variables defined to help predict healthcare cost? Select all that apply.

Variables to capture chronic conditions

Noncompliance to treatment

Illness severity

Interactions between illnesses

Explanation

All of these variables were defined using the claims data to improve cost predictions. This shows how the intuition of experts can be used to define new variables and improve the model.