Analytics and Decision Support in Health Care Operations Management
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Content
Tables and Figures xi
Acknowledgments xxi
The Author xxiii
Introduction xxv
Chapter-by-Chapter Revisions for the Third Edition xxvii
Chapter 1: Introduction to Analytics and Decision Support in Health Care Operations Management 1
Learning Objectives 1
Historical Background and the Development of Decision Techniques 2
The Health Care Manager and Decision Making 3
Importance of Health Analytics: Information Technology (IT) and Decision Support Techniques 3
The Scope of Health Care Services, and Recent Trends 4
Health Care Services Management 5
Distinctive Characteristics of Health Care Services 5
Big Data and Data Flow in Health Care Organizations 7
Summary 9
Key Terms 9
Chapter 1 Supplement: Data Analytics in MS Excel: Creating and Manipulating Pivot Tables 10
Exercises 23
Chapter 2: Predictive Analytics 27
Learning Objectives 27
Steps in the Predictive Analytics Process 28
Predictive Analytics Techniques 29
Judgmental Predictions 29
Time-Series Technique 30
Techniques for Averaging 31
Techniques for Trend 41
Predictive Techniques for Seasonality 55
Accuracy of Predictive Analytics 61
Prediction Control 62
Summary 65
Key Terms 65
Exercises 66
Chapter 3: Decision Making in Health Care 85
Learning Objectives 85
The Decision Process 85
What Causes Poor Decisions? 87
The Decision Level and Decision Milieu 87
Decision Making under Uncertainty 88
Payoff Table 88
Decision Making under Risk 93
What If Payoff s Are Costs 97
The Decision Tree Approach 101
Analysis of the Decision Tree: Rollback Procedure 102
Sensitivity Analysis in Decision Making 103
Decision Analysis with Nonmonetary Values and Multiple Attributes 107
Clinical Decision Making and Implications for Management 110
Summary 114
Key Terms 114
Exercises 115
Chapter 4: Facility Location 135
Learning Objectives 135
Location Methods 137
Cost-Profit-Volume (CPV) Analysis 137
Factor Rating Methods 140
Multi-Attribute Methods 143
Center of Gravity Method 145
Geographic Information Systems (GIS) in Health Care 149
Summary 154
Key Terms 154
Exercises 155
Chapter 5: Facility Layout 169
Learning Objectives 169
Product Layout 170
Process Layout 171
Process Layout Methods 171
Method of Minimizing Distances and Costs 175
Computer-Based Layout Programs 175
Fixed-Position Layout 177
Summary 180
Key Terms 180
Exercises 181
Chapter 6: Flow Processes Improvement: Reengineering and Lean Management 197
Learning Objectives 197
Reengineering 198
Lean Management 199
Work Design in Health Care Organizations 203
Work Measurement Using Time Standards 207
Work Measurement Using Work Sampling 214
Work Simplification 223
Worker Compensation 237
Summary 237
Key Terms 238
Exercises 238
Chapter 7: Staffing 253
Learning Objectives 253
Workload Management Overview 254
Establishment of Workload Standards and Their Influence on Staffing Levels 254
Patient Acuity Systems 256
The Development of Internal Workload Standards 261
Procedurally Based Unit Staffing 263
Acuity-Based Unit Staffing 266
External Work Standards and Their Adjustments 270
Productivity and Workload Management 271
Summary 273
Key Terms 273
Exercises 273
Chapter 8: Scheduling 281
Learning Objectives 281
Staff Scheduling 281
Surgical Suite Resource Scheduling 290
Summary 294
Key Terms 295
Exercises 295
Chapter 9: Productivity and Performance Benchmarking 297
Learning Objectives 297
Trends in Health Care Productivity: Consequences of Reforms and Policy Decisions 298
Productivity Definitions and Measurements 299
Commonly Used Productivity Ratios 302
Adjustments for Inputs 304
Adjustments for Outputs 308
Case Mix Adjustments 310
Productivity Measures Using Direct Care Hours 312
The Relationships between Productivity and Quality in Hospital Settings 314
Dealing with the Multiple Dimensions of Productivity: New Methods of Measurement and Benchmarking 316
Data Envelopment Analysis 318
Overview on Improving Health Care Productivity 321
Summary 323
Key Terms 323
Exercises 323
Chapter 10: Resource Allocation 333
Learning Objectives 333
Linear Programming 333
Maximization Models 335
Minimization Models 345
Integer Programming 346
Summary 355
Key Terms 356
Exercises 356
Chapter 11: Supply Chain and Inventory Management 363
Learning Objectives 363
Health Care Supply Chain 363
Traditional Inventory Management 370
Economic Order Quantity Model 374
Classification System 379
Summary 384
Key Terms 384
Exercises 384
Chapter 12: Quality Control and Improvement 393
Learning Objectives 393
Quality in Health Care 393
Total Quality Management (TQM) and Continuous Quality Improvement (CQI) 397
Six-Sigma 398
Quality Measurement and Control Techniques 399
Monitoring Variation through Control Charts 401
Control Charts for Attributes 403
Control Charts for Continuous Variables 407
Investigation of Control Chart Patterns 412
Process Improvement 415
Tools for Investigating the Presence of Quality Problems and Their Causes 417
Summary 421
Key Terms 421
Exercises 421
Chapter 13: Project Management 431
Learning Objectives 431
The Characteristics of Projects 432
Planning and Scheduling Projects 434
The Network 436
Critical Path Method (CPM) 437
Probabilistic Approach 441
Project Compression: Trade-Off s Between Reduced Project Time and Cost 448
Project Management Applications in Clinical Settings: Clinical Pathways 461
Summary 464
Key Terms 464
Exercises 464
Chapter 14: Queuing Models and Capacity Planning 477
Learning Objectives 477
Queuing System Characteristics 479
Capacity Analysis and Costs 494
Summary 496
Key Terms 497
Exercises 497
Chapter 15: Simulation 507
Learning Objectives 507
Simulation Process 507
Monte Carlo Simulation Method 510
Performance Measures and Managerial Decisions 516
Excel-Based Simulation Templates with Performance Measures and Managerial Decisions 517
Multiphase Simulation Model 520
Summary 522
Key Terms 522
Exercises 522
Appendixes
Appendix A: Standard Normal Distribution 527
Appendix B: Standard Normal Distribution 529
Appendix C: Cumulative Poisson Probabilities 533
Appendix D: t-Distribution 539
References 541
Index 549
Tables & Figures
Tables
1.1 Total Expenditures on Health as Percentage GDP for 37 OECD Countries
1.2 Examples of External Data Sources
2.1 Patient Falls, Medication Errors, and Case-Mix Index Data from Medical/Surgical Units of Hospitals.
2.2 Heal-Me Hospital Average Daily Patients for Emergency Department.
2.3 Quarterly Indexes for Heal-Me Hospital.
2.4 Monthly Indexes for Heal-Me Hospital.
2.5 Daily Indexes for Heal-Me Hospital.
2.6 Monthly and Daily Adjusted Predictions for Emergency Department of Heal-Me Hospital.
2.7 Error Calculations
3.1 Payoff Table
3.2 Demand for Additional MRIs
3.3 Maximin Solution
3.4 Maximax Solution
3.5 Sensitivity Analysis Using Hurwitz Optimism Parameters
3.6 Opportunity Losses (Regrets)
3.7 Laplace Strategy
3.8 Payoff Table for EMV
3.9 Expected Opportunity Loss
3.10 Best Outcomes under Certainty
3.11 Total Cost of Alternatives under Various Demand Conditions
3.12 Regret Table Using Costs
3.13 Summary of Supplier Proposals
4.1 Factors to Be Considered in Establishing a Satellite Clinic
4.2 Relative Scores on Factors for a Satellite Clinic
4.3 Relative Factor Scores and Weights
4.4 Composite Scores
4.5 Satellite Clinic Factor Rankings and Minimum Acceptable Levels
4.6 Satellite Clinic Factor Minimum Acceptable Levels
4.7 Satellite Clinic Factor Importance Rankings
4.8 Selected Richmond Metropolitan Area Hospitals with Coordinates
4.9 Selected Richmond Metropolitan Area Hospitals and Their Interaction with the Blood Bank
4.10 Data for Potential Sites
5.1 Distance and Flows among Three Hospital Departments
5.2 Possible Assignment Configurations of Departments to Three Locations
5.3 Ranking Departments According to Highest Flow
5.4 Total Cost of a Layout
6.1 Typical Allowance Percentages for Varying Health Care Delivery Working Conditions
6.2 Observed Times and Performance Ratings for Nursing Unit Activities
6.3 Observed and Normal Time Calculations for Nursing Unit Activities
6.4 Abridged Patient Care Tasks in a Nursing Unit
6.5 Work Sampling Data Collection Form for Nursing Unit
6.6 Partial Work Distribution Chart for Nursing Unit
6.7 Time Study Results
7.1 Examples of Work Standards
7.2 Daily Census, Required Labor Hours, and Acuity Level Statistics for a Medical/Surgical Floor
7.3 Average Census, Required Labor Hours, and Acuity Level Statistics for a Medical/Surgical Floor
7.4 Weighted Average Utilization for a Laboratory Based on Workload Fluctuations by Shift
7.5 Workload Standards for Microscopic Procedures in Laboratory
7.6 Calculation of Staffing Requirements for Microscopic Procedures
7.7 The Effect of Shift Alternatives on Staffing-The Coverage Factor
10.1 Nurse Scheduling with Integer Programming
11.1 A-B-C Classification Analysis
12.1 Factors for Determining Control Limits for Mean and Range Charts
13.1 Activity Precedence Relationships
13.2 Path Lengths for the Radiation Oncology Project
13.3 Probabilistic Time Estimates for Radiation Oncology Project
13.4 Calculation of Expected Time and Standard Deviations on Each Path for the Radiation Oncology Project
13.5 Path Completion Probabilities
13.6 Project Completion Probabilities
14.1 Summary Analysis for M/M/s Queue for Diabetes Information Booth
15.1 Simple Simulation Experiment for Public Health Clinic
15.2 Summary Statistics for Public Health Clinic Experiment
15.3 Patient Arrival Frequencies
15.4 Probability Distribution for Patient Arrivals
15.5 Cumulative Poisson Probabilities for ?=1.7
15.6 Cumulative Poisson Probabilities for Arrivals and Service
15.7 Monte Carlo Simulation Experiment for Public Health Clinic
15.8 Summary Statistics for Public Health Clinic Monte Carlo Simulation Experiment
Figures
1.1 Data Flow in Health Care Organizations
2.1 Seasonal Variation Characteristics
2.2 Cycle Variation
2.3 Random Variation and Trend
2.4 Excel Template Solution: Moving Average (MA3) for OB/GYN Clinic
2.5 Identifying Best Moving Averages with Graph
2.6 Excel Template Solution: Weighted Moving Average (WMA3) for OB/GYN Clinic
2.7 Excel Template Solutions to the OB/GYN Example, Using Single Exponential Smoothing (SES) with a = 0.3 and a = 0.
2.8 Excel Template Solutions to the OB/GYN Example, Using Single Exponential Smoothing (SES) with a = 0.0 and a = 1.
2.9 Linear Regression
2.10 Excel Setup-Linear Regression for the Multihospital System Example
2.11 Excel Solution to the Multihospital System Example
2.12 Linear Regression as a Trend
2.13 Excel Linear Trend Graphic Solution to the OB/GYN Example
2.14 Excel Template Solution to the OB/GYN Example
2.15 Excel Template-SEST Solution to Example 2.
2.16 Excel Setup for Multiple Regression Prediction of Patient Falls
2.17 Excel Solution to Prediction of Patient Falls
2.18 Seasonality-Removed Trend Data for Emergency Department of Heal-Me Hospital Patient Demand
2.19 Alternative Prediction Methods and Accuracy, Measured by MAD and MAPE
2.20 Linear Trend with Tracking Signal for Patient Visit Prediction, Heal-Me Hospital
2.21 Control Chart of Tracking Signal for Patient Visit Prediction, Heal-Me Hospital
3.1 Decision Process Steps
3.2 Decision Tree
3.3 Rollback Method
3.4 Payoff Table Analysis Using Excel Template for Decision Analysis
3.5 Decision Tree and Rollback Procedure Using Excel Template for Decision Analysis
3.6 Clinical Decision
3.7 Best Expected QALY Years
4.1 Total Cost of Alternative Imaging Sites
4.2 Profit Evaluation of Alternative Sites
4.3 Google Maps "What's Here?"
4.4 Google Maps Location Coordinates
4.5 Selected Richmond Metropolitan Area Hospitals
4.6 Richmond Metropolitan Area Blood Bank Locations
4.7 Geographic Information Systems
4.8 Coronary Heart Disease Hospitalization Rate for Harris County, Texas
4.9 Median Household Income Harris County, Texas
4.10 Data Table-Median Household Income, Harris County, Texas
5.1 Available Space for Layout of Long-Term Care Facility
5.2 Closeness Rating Chart for Long-Term Care Facility
5.3 A and X Closeness Representation
5.4 Layout Solution
5.5 From-To Chart for a Small Hospital
5.6 Excel Template Initial Solution
5.7 Excel Template Final Solution
6.1 Work Design-A Systems Perspective
6.2 Socio-Technical School Approach
6.3 Random Observation Schedule
6.4 Stabilized Dates and Times
6.5 Valid Dates and Times
6.6 Final Observation Schedule
6.7 Flow Process Chart for Emergency Room Specimen Processing
6.8 Commonly Used Flow Chart Symbols
6.9 Flow Chart for Emergency Room Specimen Processing
6.10 Value Stream Map for Prescribing and Dispensing Medication
6.11 Front Desk Check-In Spaghetti Diagram
6.12 Value Stream Map-Patient Flow
6.13 Spaghetti Diagram for Primary Care
6.14 Bottlenecks-Value Stream Map
6.15 Bottlenecks-Spaghetti Diagram for Primary Care
6.16 Future State Value Stream Map
7.1 Workload Management
7.2 Distribution of Daily Workload on a Nursing Unit
7.3 Workload Standard Tolerance Ranges
8.1 Comparison of Eight-, Ten-, and Twelve-Hour Shifts
8.2 Pattern of Alternating Eight- and Twelve-Hour Shifts
8.3 Cyclical Staffing Schedules for Four and Five Weeks
8.4 Example of OR Block Schedule
9.1 Productivity and Quality Trade-Off
9.2 Substitution of Physicians and Nurse Practitioners: A Look at Technical Efficiency
9.3 Example of DEA Efficiency Frontier Formulation
10.1 Graphic Solution for Insurance Company Problem
10.2 Excel Setup for the Insurance Company Problem
10.3 Excel Solver
10.4 Identifying Constraints and Solution Cells
10.5 Selection of Solution Reports
10.6 Answer Report
10.7 Sensitivity Report
10.8 Limits Report
10.9 Graphic Explanation of Sensitivity Analysis: Shadow Price and Its Impact on Alternate Optimal Solutions
10.10 Graphic Solution for Minimization Example
10.11 Excel Setup for the...
