RM in US Healthcare? A Study in Rehab Healthcare Networks

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_at_baruch.cuny.edu