New Orleans’s Mt. SinaiHospital is a large, private, 600-bed facility complete w
ID: 2939898 • Letter: N
Question
New Orleans’s Mt. SinaiHospital is a large, private, 600-bed facility complete withlaboratories, operating rooms,and X-rayequipment. In seeking to increase revenues, Mt. Sinai’sadministration has decided to make a 90-bed addition on a portion of adjacent land currently used for staffparking. The administrators feel that the labs, operatingrooms, and X-ray department are not being fullyutilized at present and do not need to be expanded to handleadditional patients. The addition of 90 beds,however, involves deciding how many beds should be allocatedto the medical staff (for medical patients) and howmany to the surgical staff (for surgical patients).The hospital’s accounting and medical recordsdepartments have provided the following pertinentinformation.
The average hospital stay for amedical patient is 8 days, and the average medical patientgenerates $2,280 in revenues. The average surgical patient isin the hospital 5 days and generates $1,515 in revenues. Thelaboratory is capable of handling 15,000 tests per year more thanit was handling. The averagemedical patient requires 3.1 lab tests, the average surgicalpatient 2.6 lab tests. Furthermore, the average medical patientuses 1 X ray, the average surgical patient 2 X rays. If thehospital were expanded by 90 beds, the X-ray department couldhandle up to 7,000 X rays without significant additional cost.Finally, the administration estimates that up to 2,800 additionaloperations could be performed in existing operating-roomfacilities. Medical patients, of course, require no surgery,whereas each surgical patient generally has one surgeryperformed.
Formulate this problem so as to determine how manymedical beds and how many surgical beds should be added to maximizerevenues. Assume that the hospital is open 365 days peryear.
Explanation / Answer
The solution needs Solver function which is an MS Excel add-in. However, I will explain the question conceptually that can then be solved easily using Excel
Assumptions:
1. X