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The validity of using claims data for measuring tumor stage, one of the most important determinants of choice of therapy and long-term survival, is unknown.To determine the relative accuracy of both inpatient and hospital Outpatient Medicare claims for measuring the stage of disease of six commonly diagnosed cancers.Analysis of a database linking Surveillance, Epidemiology, and End Results (SEER) registry data and Medicare claims in patients aged 65 years with cancer.Three hundred twenty thousand, six hundred and thirty seven cases of invasive breast, colorectal, endometrial, lung, pancreatic, and prostate cancers diagnosed between 1984 and 1993.Using SEER files as the "gold standard," concordance with Medicare claims, as well as sensitivity and positive predictive value of coding for each stage was measured.Although Medicare data correctly categorized local, regional, and distant stage tumors in 97%, 33%, and 65%, respectively, the data substantially overestimated the proportion of localized tumors and underestimated the rate of regional stage disease. The highest concordance was observed for breast and colorectal cancer. However, the sensitivity and positive predictive values were never simultaneously 80% within one stage of a specific cancer. The accuracy of coding for stage in Outpatient files was inferior to inpatient data.With few exceptions, Medicare claims have limited utility as a measure of cancer stage. If tumor registry data are not available, investigators should consider the trade offs in sensitivity and predictive value when considering a study that will use claims data.