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RM in US Healthcare? A Study in Rehab Healthcare Networks

RM in US Healthcare? A Study in Rehab Healthcare Networks. William P. Millhiser, PhD Zicklin School of Business Baruch College The City University of New York INFORMS RM and Pricing Conference, Barcelona, 29-June-2007. Typical Flow. Operating Room. Rehab. elective. urgent. Outpatients.

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RM in US Healthcare? A Study in Rehab Healthcare Networks

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  1. RM in US Healthcare? A Study in Rehab Healthcare Networks William P. Millhiser, PhD Zicklin School of Business Baruch College The City University of New York INFORMS RM and Pricing Conference, Barcelona, 29-June-2007

  2. Typical Flow Operating Room Rehab elective urgent Outpatients

  3. OR Capacity • Capacity for emergencies: Gerchak, Gupta and Henig 1996 • Surgical time distributions Goldman et al. 1970 Shukla et al. 1990 Gerchak, Gupta and Henig 1996 Gupta & Denton 2007

  4. Rehab Bed Capacity “If a patient is scheduled for surgery at a time that all [rehabilitative] beds are occupied, the system is said to be backed up or blocked and the surgeries need to be rescheduled.” -- Healthcare Operations Professional

  5. Indirect and Direct Waiting Costs • Magerlein & Martin 1978 • Pierskalla & Brailer 1994 • Lagergrenm 1998 • Cayirli & Veral 2003

  6. Patient Choice • Talluri & van Ryzin 2004 • Zhang & Cooper 2005 • Gupta & Wang 2007 (healthcare specific) Importance of Patient Choice (Gupta & Denton 2007): Primacy Care Clinic Specialty Clinic Elective Surgery High Medium Low

  7. Summary We have a problem of assigning ORs, doctors and bed-space capacity to randomly arriving competing customer classes that pay different amounts for identical (non-critical) service. The opportunity to provide the service is scheduled in advance and expires if unused, and the bed recovery creates a queuing network with blocking.

  8. Open Questions • Is RM ethical in healthcare (regardless of applicability)? • Are patient surgical and recovery times too variable and doctor capacity too flexible for “pure” or “scientific” RM? • The optimality of a threshold-type admission policy in a multi-class tandem queue with blocking where mean service rates at each stage are conditioned on patient-class? (Can prove for patients with i.i.d. service rates, see Millhiser and Burnetas 2007). d. Would any healthcare organization adopt RM? william_millhiser@baruch.cuny.edu

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