OCLC: 46555892
In an era of decreasing funding, it is vital that acute care hospitals make the most efficient and effective use of their resources. This thesis describes the use of lexicographic goal programming to allocate resources to physicians at Mount Sinai Hospital in Toronto.
The hospital is modelled as a single firm with two management hierarchies: physicians and administrators. The hospital's administration and its medical staff are assumed to compete for control in "a rarefied atmosphere of intrigue and deceit." To jointly satisfy the objectives of these two groups, a case mix selection model, based on a lexicographical goal programming approach, is developed. The algorithm selects a case mix for physicians in such a way that:
An alternate view of resource allocation is provided by a second goal programming model that translates case mix recommendations into a set of commensurate changes to physician practice. This model identifies practice changes necessary to ensure each physicians can produce a preferred mix of cases within the confines of the resources allocated by the case mix model.
The models are tested against a scenario in which funding from the provincial government is reduced by 18% over a three year period. Results indicate it is possible to jointly satisfy the economic desires of both hospitals and physicians, through case mix changes alone, at funding reduction levels of 11% or less. After an 18% reduction, a joint strategy of price reduction and case mix change is necessary. An extension is described that allows investigation of price/volume tradeoffs.
Model results also suggest the availability of operating room time is a critical determinant of both hospital profit and physician revenue; wherever possible, administrators should avoid cost cutting strategies that reduce this resource.
Several policy insights can be derived from model results. Tests under both prospective payment and global budgeting suggest hospital funding methodology has little impact on resource allocation. Nevertheless, to limit the absolute value of funding reductions institutions should attempt to achieve strict prospective payment break even in the period immediately prior to a change in funding methodology.