The implementation of the mandatory alternative payment model (APM) guarantees savings for Medicare regardless of participant hospitals ability for reducing spending that shifts the cost minimization burden from insurers onto the hospital administrators. Surgical interventions account for more than 30% and 40% of hospitals total cost and total revenue, respectively, with a cost structure consisting of nearly 56% direct cost, thus, large cost reduction is possible through efficient operation management. However, optimizing operating rooms (ORs) schedules is extraordinarily challenging due to the complexities involved in the process. We present new algorithms and managerial guidelines to address the problem of OR planning and scheduling with disturbances in demand and case times, and inconsistencies among the performance measures. We also present an extension of these algorithms that addresses production scheduling for sustainability. We demonstrate the effectiveness and efficiency of these algorithms via simulation and statistical analyses.

Balancing trade-offs between production cost and holding cost is critical for production and operations management. Utilization of an operating room affects production cost, which relates to makespan, and patient flowtime affects holding cost. There are trade-offs between two objectives, to minimize makespan and to minimize flowtime. However, most existing constructive heuristics focus only on single-objective optimization. In the current literature, NEH is the best constructive heuristic to minimize makespan, and LR heuristic is the best to minimize flowtime. In this thesis, we propose a current and future deviation (CFD) heuristic to balance trade-offs between makespan and flowtime minimizations. Based on 5400 randomly generated instances and 120 instances in Taillard’s benchmarks, our CFD heuristic outperforms NEH and LR heuristics on trade-off balancing, and achieves the most stable performances from the perspective of statistical process control.