Tactical planning in healthcare using approximate dynamic programming

Tactical planning of resources in hospitals concerns elective patient admission planning and the intermediate term allocation of resource capacities. Its main objectives are to achieve equitable access for patients, to serve the strategically agreed number of patients, and to use resources efficiently. We propose a method to develop a tactical resource allocation and patient admission plan that takes stochastic elements into consideration, thereby providing robust plans. Our method is developed in an Approximate Dynamic Programming (ADP) framework and copes with multiple resources, multiple time periods and multiple patient groups with various uncertain treatment paths through the hospital and an uncertain number of arrivals in each time period, thereby integrating decision making for a chain of hospital resources. Computational results indicate that the ADP approach provides an accurate approximation of the value functions, and that it is suitable for large problem instances at hospitals, in which the ADP approach performs significantly better than two other heuristic approaches. Our ADP algorithm is generic, as various cost functions and basis functions can be used in various settings of tactical hospital management.