Efficiency evaluation for pooling resources in health care: An interpretation for managers

Subject/Research problem\ud Hospitals traditionally segregated resources into centralized functional departments such as diagnostic departments, ambulatory care centres, and nursing wards. In recent years this organizational model has been challenged by the idea that higher quality of care and efficiency in service delivery can be achieved when services are organized around patient groups. Examples are specialized clinics for breast cancer patients and clinical pathways for diabetes patients. Hospitals are grappling more and more with the question, should we become more centralized to achieve economies of scale or more decentralized to achieve economies of focus. In this paper service and patient group characteristics are examined to determine conditions where a centralized model is more efficient and conversely where a decentralized model is more efficient.\ud Research Question\ud When organizing hospital capacity what service and patient group characteristics indicate that efficiency can be gained through economies of scale vs. economies of focus?\ud Approach\ud Using quantitative models from the Queueing Theory and Simulation disciplines the performance of centralized and decentralized hospital clinics are compared. This is done for a variety of services and patient groups. \ud Result\ud The study results in a model measuring the tradeoffs between economies of scale and economies of focus. From this model “rules of thumb” for managers are derived.\ud Application\ud The general results support strategic planning for a new facility at the Netherlands Cancer Institute - Antoni van Leeuwenhoek Hospital. A model developed during this study is also applied in the Chemotherapy Department of the same hospital.\u

Designing for Economies of Scale vs. Economies of Focus in Hospital Departments

Subject/Research problem: Hospitals traditionally segregate resources into centralized functional departments such as diagnostic departments, ambulatory care centres, and nursing wards. In recent years this organizational model has been challenged by the idea that higher quality of care and efficiency in service delivery can be achieved when services are organized around patient groups. Examples are specialized clinics for breast cancer patients and clinical pathways for diabetes patients. Hospitals are struggling with the question whether to become more centralized to achieve economies of scale or more decentralized to achieve economies of focus. In this paper service and patient group characteristics are examined to determine conditions where a centralized model is more efficient and conversely where a decentralized model is more efficient. - Research Question: When organizing hospital capacity what service and patient group characteristics indicate efficiency can be gained through economies of scale vs. economies of focus? - Approach: Using quantitative Queueing Theory and Simulation models the performance of centralized and decentralized hospital clinics is compared. This is done for a variety of services and patient groups. - Result: The study results in a model measuring the tradeoffs between economies of scale and economies of focus. From this model management guidelines are derived. - Application: The general results support strategic planning for a new facility at the Netherlands Cancer Institute - Antoni van Leeuwenhoek Hospital. A model developed during this research is also applied in the Chemotherapy Department of the same hospital

Efficiency evaluation for pooling resources in health care

Hospitals traditionally segregate resources into centralized functional departments such as diagnostic departments, ambulatory care centers, and nursing wards. In recent years this organizational model has been challenged by the idea that higher quality of care and efficiency in service delivery can be achieved when services are organized around patient groups. Examples include specialized clinics for breast cancer patients and clinical pathways for diabetes patients. Hospitals are struggling with the question of whether to become more centralized to achieve economies of scale or more decentralized to achieve economies of focus. In this paper we examine service and patient group characteristics to study the conditions where a centralized model is more efficient, and conversely, where a decentralized model is more efficient. This relationship is examined analytically with a queuing model to determine themost influential factors and then with simulation to fine-tune the results. The tradeoffs between economies of scale and economies of focus measured by these models are used to derive general management guidelines

Efficiency evaluation for pooling resources in health care

Hospitals traditionally segregate resources into centralized functional departments such as diagnostic departments, ambulatory care centres, and nursing wards. In recent years this organizational model has been challenged by the idea that higher quality of care and efficiency in service delivery can be achieved when services are organized around patient groups. Examples include specialized clinics for breast cancer patients and clinical pathways for diabetes patients. Hospitals are struggling with the question of whether to become more centralized to achieve economies of scale or more decentralized to achieve economies of focus. Using quantitative Queueing Theory and Simulation models, we examine service and patient group characteristics to determine the conditions where a centralized model is more efficient and conversely where a decentralized model is more efficient. The results from the model measure the tradeoffs between economies of scale and economies of focus from which management guidelines are derived

A survey of health care models that encompass multiple departments

In this survey we review quantitative health care models to illustrate the extent to which they encompass multiple hospital departments. The paper provides general overviews of the relationships that exists between major hospital departments and describes how these relationships are accounted for by researchers. We find the atomistic view of hospitals often taken by researchers is partially due to the ambiguity of patient care trajectories. To this end clinical pathways literature is reviewed to illustrate its potential for clarifying patient flows and for providing a holistic hospital perspective

An analytical comparison of the patient-to-doctor policy and the doctor-to-patient policy in the outpatient clinic

Outpatient clinics traditionally organize processes such that the doctor remains in a consultation room, while patients visit for consultation, we call this the Patient-to-Doctor policy. A different approach is the Doctor-to-Patient policy, whereby the doctor travels between multiple consultation rooms, in which patients prepare for their consultation. In the latter approach, the doctor saves time by consulting fully prepared patients. We compare the two policies via a queueing theoretic and a discrete-event simulation approach. We analytically show that the Doctor-to-Patient policy is superior to the Patient-to-Doctor policy under the condition that the doctor’s travel time between rooms is lower than the patient’s preparation time. Simulation results indicate that the same applies when the average travel time is lower than the average preparation time. In addition, to calculate the required number of consultation rooms in the Doctor-to-Patient policy, we provide an expression for the fraction of consultations that are in immediate succession; or, in other words, the fraction of time the next patient is prepared and ready, immediately after a doctor finishes a consultation.We apply our methods for a range of distributions and parameters and to a case study in a medium-sized general hospital that inspired this research

Leaving a mark on healthcare delivery with operations analysis

In the Dutch context we see similar problems as outlined in Linda Green’s commentary and, due in part to the redesign of the healthcare financing structure in the Netherlands, we have also seen a tremendous increase in the demand for operations analysis. The major redesign of the financial structure is described below, but for now, it is sufficient to state that its principal purpose is to achieve better value for the money spent on healthcare. Achieving more value for money is certainly an area where operations analysis can play a leading role. As a result, the demand for both our research capacity and recent graduates has been increasing. Furthermore, since healthcare providers are truly engaged, implementations of our results and recommendations have likewise increased. In this paper, we discuss recent projects to build on Linda Green’s commentary and to argue how to apply operations analysis in healthcare in a scientifically and practically relevant way

Optimizing the strategic patient mix

In this paper we address the decision of choosing a patient mix for a hospital that leads to the most beneficial treatment case mix. We illustrate how capacity, case mix and patient mix decisions are interrelated and how understanding this complex relationship is crucial for achieving the maximum benefit from the fee-for-service financing system. Although studies to determine the case mix that is of maximum benefit exist in the literature, the hospital actions necessary to realize this case mix has seen less attention. We model the hospital as an $M/G/\infty$ queueing system to evaluate the impact of accepting certain patient types. Using this queueing model to generate the parameters, an optimization problem is formulated. We propose two methods for solving the optimization problem. The first is exact but requires an integer linear programming solver whereas the second is an approximation relying only on dynamic programming. The model is applied in the department of surgery at a Dutch hospital. The model determines which patient types result in the desired growth in the preferred surgical treatment areas. The case study highlights the impact of striving for a certain case mix without providing a sufficiently balanced supply of resources. In the case study we show how the desired case mix can be better archieved by investing in certain capacity

Reallocating resources to focused factories: a case study in chemotherapy

This study investigates the expected service performance associated with a proposal to reallocate resources from a centralized chemotherapy department to a breast cancer focused factory. Using a slotted queueing model we show that a decrease in performance is expected and calculate the amount of additional resources required to offset these losses. The model relies solely on typical outpatient scheduling system data, making the methodology easy to replicate in other outpatient clinic settings. Finally, the paper highlights important factors to consider when assigning capacity to focused factories. These considerations are generally relevant to other resource allocation decisions

Reallocating resources to focused factories: a case study in chemotherapy

This study investigates the expected service performance associated with a proposal to reallocate resources from a centralized chemotherapy department to a breast cancer focused factory. Using a slotted queueing model we show that a decrease in performance is expected and calculate the amount of additional resources required to offset these losses. The model relies solely on typical outpatient scheduling system data, making the methodology easy to replicate in other outpatient clinic settings. Finally, the paper highlights important factors to consider when assigning capacity to focused factories. These considerations are generally relevant to other resource allocation decisions