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«Hospital system design creating supply flexibility to match demand variability J.J.W. Molema Hospital system design creating supply flexibility to ...»

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Hospital system design

creating supply flexibility to match demand variability

J.J.W. Molema

Hospital system design

creating supply flexibility to match demand variability

The research for this thesis was performed at the department of Health Organization, Policy and

Economics, within the School for Public Health and Primary Care (CAPHRI), Faculty of Health,

Medicines and Lifesciences, Maastricht University.

Part of the research was performed with the financial support of the Netherlands Organization for Health Research and Development (ZonMw) and the Aravind Eye Care System.

Printing: Datawyse / Universitaire Pers Maastricht Cover design: Leonne Bongers lay-out: I.I.W. Molema ISBN 978 90 5278 874 6 © J.J.W. Molema, Maastricht 2009 STATEMENTS Belonging to the PhD dissertation of J.J.W. Molema Hospital system design - creating supply flexibility to match demand variability

1. The functionalistic structures and professional hierarchies In most hospitals do not match the demands of most patients - This thesis

2. With cross-functional wards opportunities arise for hospitals to improve both patient flow continuity and utilization of resources - This thesis

3. The disparities and variability in a hospital's environment and the hospital itself should provide the framework for the hospital's structure - This thesis

4. Healthcare should not only be redefined; organizational structures should also be redesigned with a focus on value creation and flexibility that leaves room for variability in patients' demands - This thesis

5. Faster healthcare without waiting times is not necessarily better healthcare; it should be up to patients to determine, in good deliberation with their care providers, the time necessary and desired in between activities

6. It is more important to have good hospitals in every other city than to hove hospitals in every city

7. It benefits the quality of overall healthcare that not every hospital strives to 'do it all'

8. The trend in chronic disease management to substitute hospital care with primary core implies a better organization of hospitals

9. With less money more creativity is demanded; Accordingly, to find inspirational examples on excellence in healthcare, go beyond the beaten Westem tracks to unlooked-for places at the bottom of the pyramid 10. "Not everybody wins, and certainly not everybody wins all the time. But once you get into your boat and push off you hove indeed won far more than those who hove never tried" - Unknown 11. "Thousands of candles can be lit from a single candle, and the life of the candle will not be shortened. Happiness never decreases by being shared" Siddhaiiha Gautaina Hospital system design creating supply flexibility to match demand variability

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Prof. dr. G.G. van Merode Assessment Committee Prof. dr. C. Spreeuwenberg (chairman) Prof. dr. J.A.M. Maarse Prof. dr. A.C. Nieuwenhuijzen Kruseman Prof. dr. ir. J.M.H. Vissers (Erasmus University Rotterdam) Prof. dr. J. de Vries (University of Groningen) "So eine Arbeit v/ird eigentlich nie fertig; man muss sie für fertig erklären wenn man noch Zeit und Umstanden das Möglichste getan hat" j. W. vor) Goethe 0787)

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Chapter 2 Flexibility in hospitals through parttime working doctors 25 Chapter 3 Specialty labeling limits patient flow continuity 43 Chapter 4 Creating cross-functional wards in hospitals to improve patient flow Chapter 5 A vision on hospital system design: Aravind Eye Hospital 83 Chapter 6 Analyzing hospital system design - How supply flexibility con improve performance

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Introducfiori CHAPTER 1 When a patient goes to a hospital, he expects to receive the care he needs, at the moment he needs it [1]; yet, being a patient is almost intrinsically bound to waiting [2-4]. Patients are not just waiting on waiting lists to gain access to a hospital but, once inside, continuous flow is lacking and patients ore likely confronted with (high) in-process waiting times [5-7]. Only few hospitals are designed to achieve optimal patient flow [4]. The design of most hospitals gets patients entangled in jumbled, stop-start flows that impede a lean progress of a treatment [4, 8, 9]. In such hospitals, patient appointments are cancelled or delayed and patients themselves are transferred back and forth between departments. Such outcomes incur hospital costs and can decrease the quality of care [10].

Most hospitals do not seem able to adequately match demand and supply.

This can be derived from the fact that most hospitals are characterized by waiting lists and in-process waiting times as well as inefficient use of (human) resources. Due to the higher demands placed on healthcare by the ageing population as well as the increase of acute core services and co-morbidity and poly-morbidity, the need for a better match between supply and demand becomes even more evident [4, 11, 12]. This thesis aims to explicate opportunities for matching supply to demand in hospitals from the perspective of operations management.

1 Current hospital systems

Patient demand con be defined as the care and quality of care that patients ask for or need from a hospital system at a specific time and place. Hospital supply, in this respect, can be defined as the care and quality of care that is offered at a specific time and place and by the (human) resources that are elements of the hospital system. Previous studies hove shown that the imbalance between demand and supply in hospitals can be explained with insights from operations management [3, 4, 8, 9, 13-16]. Operations management (OM) is concerned with the design, operations, and improvement of production systems that create an organization's output [17, 18]. OM has many dimensions, one of them being 'design and control' [19]. Through design and control, systems should match supply and demand, such that waiting times for customers are minimized and resource utilization is maximized [18].

In their strategy, hospitals lay down what services they want to offer and to whom. Many hospitals, additionally, express in their mission statement that


they aim to serve their patients as well as possible and strive to deliver patient centered care. The way hospitals are designed and use resources determines what they supply to patients and how they can treat their patients. From the viewpoint of OM, a hospital delivers patient centered care when it designs its system to achieve continuous patient flows without cancellations and delays [8].

Most hospitals are home to a variety of medical specialties and departments that each focus on their own patients, staff and non-human resource capacities [9, 14]. The overall system is more a virtual organization and each department functions as an independent system, treating a range of more or less homogeneous patient groups [7]. As such, performance control at the departments focuses on local optimization and is not always aligned to what is optimal for patients [20]. For example, the focus on medical specialties means patients might have to wait, e.g., for a bed or for an operating room of specialty A to become available, while specialty B has several beds idle or operating time available. Also, as more than half of the patients demand care from more than one specialty, the tension between patient flow and local optimization is rising [20].

The local (sub)optimization is a result of the functional organization of hospitals [21]. That is, if hospitals are structured into specialty departments, more coordination is needed [20]. We could say that hospitals, with their functionalistic structure, are complex systems [9]. Complexity can address both the materials processed in a system and the processing itself. In hospitals, the matenals processed ore the patients and their demands. Patient demands can be complex in a sense that patients demand care from multiple medical specialties or that their disease is rare or highly medically complex [9].

Demands con also be complex when one disease manifestation can have multiple causes or when the relation between cause and effect is ambiguous [20]. Complexity stemming from demand can also be the result of nondeterministic arrival times of demand, which cause uncertainty about when service is required [22]. Processing in hospitals can be complex when a treatment process has many coordination and transfer points and/or when multiple specialties are involved [9]. Complexity can also result from nondeterministic treatment times, which make it difficult to coordinate the processing [22].

Maruster et al. assume that the more specialties or physicians involved in a treatment, the more complex the case is [20]. Ideally, from a patient's perspective, the complexity of processing should depend on the complexity of


his demand. This is, however, not always the case. If we take the functionalistic structure of hospitals as an example, this structure and its processing complexities do not always have a relation with the medical complexity of demand. Patients that need some diagnostic tests, diagnostic imaging (e.g. an X-ray), and a visit to a doctor, currently need to make several appointments and need to come back several times [23].

Supply should not only match demand in terms of complexity, but also in terms of variability. Changes in demand often occur in hospitals and are the result of inherent non-uniformity, or variability [5, 18]. This variability causes uncertainty for hospitals and can affect system performance [5, 18, 2 2 ]. By creating variety in its resources and generating options to do things differently if demand changes, hospital managers can create a system state needed to respond to vanability and minimize its effects [24, 2 5 ]. This requires the system to be flexible [26].

To minimize waiting for patients and maximize resource utilization, demand and supply should match. Hospitals can achieve this through structuring the system such that system complexity and flexibility are aligned to demand complexity and variability. In this thesis, demand complexity and variability are treated as a given, i.e. a constant factor, and it is studied how supply can be matched to demand. In the next paragraph, a conceptual basis is given for studies conducted within this thesis.

2. System structure, planning a n d control

A system is a collection of entities, e.g., people, machines, tasks, or subsystems, that act and interact together to accomplish objectives [27].

System structure represents the relations amongst the entities in the system, whether and how elements are divided into subsystems, how coordination amongst the entities is achieved, and how the system functions [28-33]. To structure a system, planning and control decisions need to be token [34].

2.1 Planning and confrol Production control in a hospital concerns, within the boundaries set by evidence based medicine, the design, planning, implementation, and control of coordination mechanisms between patient flows and workflows. Hereby, production control aims to maximize output with available resources and minimize waiting times and costs, while ensuring delivery flexibility [7].

Planning and control decisions need to be made to manage supply on a daily


base and structure the hospital as a whole in the long run [35]. Through the decisions, hospitals can trade-off between patient service levels and resource utilization. Service levels, expressed in e.g. patient waiting times, can be increased by making more resources available to patients. The latter decreases the probability of patients waiting for resources and thus increases service levels from on OM perspective. In contrast, increasing the number of available resources can affect the resource utilization level and make the overall use of resources in a system less efficient.

The trade-off between patient service levels and resource utilization is mode for the hospital as a whole as well as for each of the departments and patient groups the hospital aims to serve [7]. This implies that planning and control takes place on different levels. In fact, it varies from strategic planning, to medium-term planning, and day-to-day decisions [25, 30, 34, 36]. The decisions mode on the different levels serve different purposes. Table 1 displays a hierarchical framework of planning and control of hospital supply that encompasses both the planning levels and their purposes.

Based on the hospital's strategy, a group of patients is selected that will be serviced in the hospital. This group of patients has on inherent variability in terms of demand mix, volume and delivery (how many patients of what type will demand care when?). Next to that, the medical complexity of the cases is a given. To provide patient centered care and optimize service levels, supply in the hospital should be matched to this demand within the boundaries set by evidence based medicine. From on OM viewpoint, the goal of matching supply and demand would be to minimize patient waiting times and unnecessary transfer points, while maximizing resource utilization. Following on OM, this match con be strived for through planning and control. Hereto, hospitals can use the hierarchical planning framework in table 1.

The framework in table 1 can be used top-down, which means that first the long-term strategy and the patient mix are defined before medium-term decisions are mode regarding the volume and skill mix of resources and the grouping of patients and resources into configurations. Finally, more short-term decisions are mode to, e.g., define the doily allocation of resources to single patient groups.


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2.2Systefn structure Through planning and control of patient volume, resources, and patient groups hospital managers con structure the hospital and its departments. The structure that follows from the planning and control decisions determines the flow of both work and customers within the system and impinges on the required variety in resource skill levels within and between subsystems as well as on the interchangeobility of resources and skills across subsystems [18].

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