Distributed resource allocation for healthcare systems

Healthcare costs in most developed economies have grown dramatically over the last few decades. It is widely believed that the inefficiency of healthcare institutions has contributed to this rise. In response to this belief, much scholarly attention has been devoted to allocating resources for efficient operation of healthcare institutions. Traditionally, centralized methods are applied to such problems. However, the inherent, decentralized nature of many hospitals for the same healthcare corporation drives the investigation on decentralized or distributed methods. This paper explores the application of a linear and a nonlinear pricing model for healthcare resource allocation in specific, staffing configurations. A simulation model for hospital emergency room (ER) is developed to collect the performance data. The data is then analyzed to construct linear programming (LP) model for each ER staffing configuration problem. Two pricing models are employed to find the equilibrium solutions between two ERs.