Benefits of Surgical Smoothing and Spare Capacity: An Econometric Analysis of Patient Flow

In this study, we examine the hospital's ability to admit patients from its emergency department. From a medical perspective, the number of patients being admitted should depend solely on the patients' clinical conditions. Using a large-scale econometric study that includes detailed operational and clinical data on all cardiac patient encounters from a set of 128 hospitals over a period of four years, we show that this is not the case. In particular, we find that independent of their medical condition, many emergency patients are denied hospital admission because of a lack of inpatient beds. Our analysis suggests that having one more inpatient bed at the start of a day can increase the likelihood of an emergency room patient admission by around 3% on average. We examine two policies - active discharge and demand smoothing - that can help hospitals improve patient access. We find that some hospitals actively discharge inpatients when beds become scarce; hospitals that follow such an active discharge protocol are, on average, able to admit more patients. We also investigate to what extent the hospital's ability to smooth its surgical schedule impacts hospital admissions. Hospitals tend to schedule their elective patients early in the week (Mondays and Tuesdays), and discharge them by the weekend in order to minimize weekend staffing, effectively maximizing bed occupancy during the middle of the week. This weekend effect artificially induces variability, and reduces effective system capacity. We find that by scheduling patients more uniformly over the week, hospitals can dramatically increase patient access, obviating the need for active discharges or additional capacity investment. Our analysis quantifies these effects, and can help hospitals make effective capacity management decisions in order to improve patient flow.