International Journal on Recent and Innovation Trends in Computing and Communication ISSN: 2321-8169 Volume: 5 Issue: 3 169 – 173 _______________________________________________________________________________________________ 169 IJRITCC | March 2017, Available @ http://www.ijritcc.org _______________________________________________________________________________________ An Optimization Model for Integrated Capacity Management and Bed Allocation Planning of Hospitals Suryati Sitepu University HKBP Nomensen Medan, Indonesia Pasukat Sembiring Department of Mathematics University of Sumatera Utara Medan, Indonesia Herman Mawengkang Department of Mathematics University of Sumatera Utara Medan, Indonesia hmawengkang@yahoo.com Abstract— Hospitals are facing with increasing demands of unlimited needs of people health. On the other hand, due to the rising cost of healthcare services, hospitals need to put more effort in order to overcome these two problems. This paper deals with proposing an integrated strategy for solving these problems. We address an integer optimization model which integrate capacity staff management problem and bed allocation planning problem. We solve the model using a direct approach, based on the notion of superbasic variables. Keywords- Capacity management, bed allocation planning, modeling, superbasic variables. __________________________________________________*****_________________________________________________ I. INTRODUCTION Hospitals are a very important institution to provide health care for people. It is not surprising that nowadays the people’s demand for hospitals is increasing. Th is condition occur particularly for the people who live in big city, such as, Medan city, the capital of North Sumatera province, Indonesia. Obviously, one of the the main cause of this rise lies in the ageing populations who are putting heavy demands for health care. The direct impact of this booming is the number of hospitals are also increasing. Unfortunately, there are more and more people from Medan who seek health care from neighbour countries, such as, Malaysia and Singapore. Undoubtedly, the urgent need to tackle this situation is to improve health service performance of hospitals. All operations related to the health service performance in hospitals are limited in terms of capacity. Therefore, in order to fulfill the patients’ demand for health care, the hospitals management should have a planning and controlling the capacity of the operations ([3], [4], [5]). Capacity planning decisions are important to any industry, especially to health care industry because not only it relates to the management of highly specialized and costly resources (i.e., nurses, doctors, and advanced medical equipment), but also it makes a difference between life and death in critical conditions [16]. Public hospitals have, in general, more demand for health services than available capacity. Therefore it is important to forecast and manage demand with good precision, in order to adjust capacity or take alternative courses of action for example transfer demand to other facilities. Demand forecasting and management is part of a larger design that intents to provide a systemic solution to global hospital management. Such solution is commonly based on the design of a general process structure for hospitals and which defines the management processes that are needed to optimize the use of resources in doing so and to ensure a predefined service level for patients. The general process structure allowed us to determine the key processes where implementation of new practices would generate most value ([18], [17]). For inpatient care facilities in a hospital, this requires information on bed capacity and nursing staff capacity, on a daily as well as annual basis. Quantitative models can be used to calculate capacity needs for different planning purposes and for short, medium and long term planning issues. Although several useful models are described in the international literature ([6], [7], [8]) many of them are difficult to apply in practice because they require a great deal of data and clerical work [6]. Healthcare executives and managers are always searching for better ways to improve production capacity for medical treatment and thus, improving operational efficiency. Obviously, many times, capacity in a health care organization is a vague and hard-to-measure concept which varies with local economic conditions and over time [25]. In any hospital, resources are scarce or limited and they are mostly dissimilar in nature. Such dissimilarity nature of capacity for different forms of resources makes the comparison of capacities very important to determine the exact capacity of the system taken as a whole. An inappropriate capacity comparison would lead to inaccurate system capacity and so resulting in inefficiencies in the system – observed in excessive waiting, poor capacity utilization across different resources and poor bottleneck management [28] Therefore, when capacity management is done properly, it can lead to lean service models in healthcare by minimizing almost all the wastage and inefficiencies. Practically, in order to be able to apply capacity management, the models must consider different