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Title : Revenue Management for a Primary-care Clinic in the Presence of Patient Choice
Date : Sep 17, 2007
Speaker : Diwakar Gupta, Professor
Affiliation : Department of Mechanical Engineering, University of Minnesota
Abstract
In addition to having uncertain patient arrivals, primary care clinics also face uncertainty arising from patient choices. Patients have different perceptions of the acuity of their need, different time-of-day preferences, as well as different degrees of loyalty toward their designated primary care provider (PCP). Advanced access systems are designed to reduce wait and increase satisfaction by allowing patients to choose either a same day or a scheduled future appointment. However, the clinic must carefully manage patients' access to physicians' slots in order to balance the needs of those who book in advance and those who require a same-day appointment. On the one hand, scheduling too many appointments in advance can lead to capacity shortages when same-day requests arrive. On the other hand, scheduling too few appointments increases patients' wait time, patient-PCP mismatch, and the possibility of clinic slots going unused.
The capacity management problem facing the clinic is to decide which appointment requests to accept in order to maximize revenue. We develop a Markov Decision Process model for the appointment-booking problem in which the patients' choice behavior is modeled explicitly. When the clinic is served by a single physician, we prove that the optimal policy is a threshold-type policy so long as the choice probabilities satisfy a weak condition. For a multiple-doctor clinic, we partially characterize the structure of the optimal policy. We propose several heuristics and an upper bound. Numerical tests show that the two heuristics based on the partial characterization of the optimal policy are quite accurate. We also study the effect on the clinic's optimal profit of patients' loyalty to their PCPs, total clinic load, and load imbalance among physicians. If time permits, this talk will also describe some recent efforts by the author on modeling staff scheduling problems faced by hospitals.
Biosketch
Diwakar Gupta is a Professor and Director of Graduate Studies for the Industrial & Systems Engineering graduate program in the Department of Mechanical Engineering at the University of Minnesota . Diwakar received his Ph.D. in Management Sciences from the University of Waterloo and taught at the McMaster University 's DeGroote School of Business before joining the University of Minnesota . His research and teaching interests are in the area of stochastic models for production/inventory systems, supply chains, and health care delivery systems. Research reported in this article was supported, in part, by the Agency for Healthcare Quality and Research. This study was motivated by Diwakar's close interactions with a suburban clinic of a major health care network in the Twin Cities area.
