Saturday, April 18, 2009

Ask The Un-Economist: Waiting Lines in Hospitals

Dear Un-Economist: I am sick and tired of waiting three hours just to see the doctor for three minutes. Frankly, I have better things to do with my time.

Dear Sick and Tired: Perhaps you should use some of that time to make an appointment. That way, it’s probably a ten-minute wait at most for, say, five minutes of examination, prescription, and maybe a little doctorly advice. Still, sitting around in those dreary hospital lobbies with all those other harried, germy patients can be a real drag. But what if I told you that much of what looks like an interminable waiting line is a mirage, and that, more importantly, forcing patients to wait actually makes economic sense?

First of all, the line is usually not as long as it looks, since the patients waiting in a single lobby will be called into any one of many rooms that line the lobby and adjacent corridors, each room holding a doctor*. Divide the number of patients in the lobby by the number of active booths, and you get the true length of the average “waiting” line**. In short, it’s never as bad as it looks. With that, let’s move on to what I think is the more important part of my argument: waiting lines make economic sense.

Let’s say that a hospital doctor has an eight-hour working day. Of that, let’s say that she uses half that time for other chores and toilet breaks and whatnot, so she has four hours to actually treat patients. Let’s now assume that she takes ten minutes on average to treat a patient, five minutes of face time and five more to prepare and process the case. This means that she can treat 60÷10×4=24 patients per day. Now at one end, the hospital can have all the patients seeking treatment from her line up in the morning, let her go through as many as she can, then have her come back the next day and repeat the sequence, and so on. This would not pose much of a problem if the patients were like damaged autos brought in for repair, but they have a life. At the other end, the hospital could employ enough comparable doctors to ensure that no patient has to wait at any time, but that would leave many doctors idle for much if not most of the time, sending the cost of the treatment through the roof.

What hospitals (and individual doctors) can and apparently do is something that falls between those two extremes. They take appointments and squeeze in patients without appointments where sufficient slack arises. Another option would be to allocate certain hours to patients without an appointment on a first-come-first-served basis. Either way, waiting lines will not be eliminated for patients without an appointment. Moreover, given the variance in the time required to treat individual patients, even patients with appointments will often have to wait in line. But something or other along these lines should go a long ways in easing the waiting line problem, as this real-life example shows.

Now some patients will say, wait a minute, I’m a lawyer, my opportunity cost is $500 an hour, I can’t afford to wait. These people can take their business out of the public healthcare system (although they will still have to pay into one or other public healthcare system) by paying for the full cost of a pricey on-demand service. I suspect that this is the kind of clientele that those extravagant Ginza clinics cater to. And if you’re really, really wealthy, I suppose that you can employ a personal physician, or even furnish a personal clinic, if you wish. These are also perfectly sensible market solutions.

In sum, it is clear that the waiting line is an economically rational means that ordinary hospitals use to maximize efficiency on the supply side by imposing opportunity costs on the demand side, but that the opportunity costs can be reduced by using an appointment system. So is it functioning? Well, to the best of my knowledge, hospitals do manage to clear their waiting lines by the end of the working day. So I can’t say that it’s broken by any means.

* If you’re a guy and this reminds you of what I think it reminds you of, then I think you need to take a cold shower.
** Note that a large number of those patients may have already seen the doctor and are waiting for their documents to be processed. But this is the same waiting line problem being replicated at the administrative level, so it poses the same resource allocation issues. Accordingly, it can be left out of this particular argument without any significant loss.




Still can’t say that I’ve 100% nailed it, so it should be going to Globaltalk 21 Raw for more polishing, but what can you expect from an Un-Economist?



There is an oft-repeated argument that old people visiting hospitals because there is no place else to go. Some people believe that this problem has eased considerably since co-payment requirements were reintroduced for the elderly. I may come back to this point on a later occasion.

8 comments:

Janne Morén said...

The "I bill $500/hour" people could also do like many other industries and go for technology-driven efficiency improvement as a solution: Bring a laptop with a wireless connection and discreetly putter about with their important documents (or Desktop Tower Defense) while they wait. They should recoup the cost of the hardware (and improve their high score) in no time flat.

As an aside, you could argue for a bit of waiting time with this chain of logic: with or without an appointment there will be variation in the exact time that the patient and the physician becomes available. Almost always, one or the other will have to wait for a bit, and occasionally for more than a little.

But physicians constitute a small minority of the population, and a comparatively small group among all professions. Their work is also arguably valued higher than the average profession (as reflected in the salary and societal respect). Their work is thus both relatively rare and relatively highly valued. So, on average, having a physician idling costs the society at large rather more than having the average person idling. This is exacerbated further as a patient may be missing work (in a societal sense), or may actually be free and not losing any time of value. The physician on the other hand, is almost certainly on the clock.

So it makes sense to skew the expected waiting time from a equitable 1/1 ratio between physician and patient to one that takes the relative average perceived value of work into account. A ratio that will make patients normally wait for a while, so that physicians only rarely have to.

In fact, as I think about this, I wonder if one couldn't do the opposite thing? Measure the actual respective average waiting time between any group of professionals and their clients, and from that data deduce their actual "worth" to society?

Jun Okumura said...

The "I bill $500/hour" people could also do like many other industries and go for technology-driven efficiency improvement as a solution: Bring a laptop with a wireless connection and discreetly putter about with their important documents (or Desktop Tower Defense) while they wait.One of the greatest benefits, if not the greatest, of broadband is that you can be as productive/counterproductive as you want while you wait. True, this diminishes your opportunity to think, daydream, or just plain dream, so it’s not an unqualified boon. Either way, it’s having an incredible effect as an informational leveler.

In fact, as I think about this, I wonder if one couldn't do the opposite thing? Measure the actual respective average waiting time between any group of professionals and their clients, and from that data deduce their actual "worth" to society?In fact, I think that’s a great idea for a research project. Trust Janne to push every point to its logical conclusion.

Ken Y-N said...

Dear Un-Economist-Letter-Writer: The solution is simple: don't go to the hospital for everything. Small clinics are just as good (or bad, depending on your take on Japanese health care) and a lot of them these days even have internet booking so you can check the length of the queue and time your trip to minimise wait time.

Oh, and last time I was in a big hospital (two years ago, Kobe Shimin Byouin) to book MRI/echo/ECG they still had huge paper ledgers for making the appointments.

And another oh: why can't they start adding up your account as soon as you finish consultation as the quack types it all into his computer then prints it out, which you then carry to a desk where they do something more and...

Triple oh: there's one hospital in Osaka that gives you a pager that buzzes 15 minutes before your appointment so you don't need to hang about in the waiting room.

Anonymous said...

Of course what may make economic sense for an individual economic agent (a doctor or hospital) may not make economic sense for the society as a whole. All it takes is the assumption that the opportunity cost of patients waiting in line to be higher than the cost of employing enough doctors to see patients immediately. Of course, this probably isn't the case since many patients aren't engaged in economic activity otherwise (retirees), or have a high opportunity cost but used their secretaries to make an appointment (executives), and doctors certainly make more than an average worker's wage. Still, it is important to consider all the costs, not just those to doctors, in deciding whether lines are efficient for society. Limiting the analysis to just doctors, of course, obviates the need for a larger consideration.

-nc

Jun Okumura said...

Ken Y-N: I have expressed (I think) similar complaints about the administrative side of hospital management. I haven’t been there for some time now, but your comment indicates that the hospitals are still well behind the curve. I wonder why; there’s so much productivity gains to be made there.

NC: To eliminate lines completely, you have to employ a huge number of doctors at great cost to sit around with nothing to do outside of peak hours. Somebody is going to have tgo pay those lawyers. Opportunity cost is merely a value-neutral tool for thinking through the problem. If society thinks that the opportunity cost for an elderly person is large—a reasonable assertion since that person has so little time left—it can factor it into the system and in fact does, by way of favorable treatment under the public healthcare system. The Make a Wish Foundation is a private sector example geared to children. Think about it.

That should take care of all your concerns, NC. I know you mean well, so let me know if I haven’t made myself clear enough.

Janne Morén said...

Electronic journals could indeed create a lot of efficiency savings. The reason it's not often used (at all, or used only as a secondary system) is that getting it right is hard. Really hard. Just a couple of points to consider:

* The journal needs to be complete; that means not only easily digitized pieces of paper, but also X-rays and test results (which often still are not generated digitally). It means you will need to be able to efficiently and most of all completely correctly digitize millions and millions of existing records. Until that can happen, digital records will be adjunct to the paper ones.

* People need to be able to enter journal data away from a desk or a computer. A sketch on paper; a hand-drawn diagram; a torn page from a notebook with scribbled vital signs during an on-site emergency all need to be efficiently and quickly entered as needed. With a paper journal that note simply goes into the file.

* Journals need to be able to travel. When a patient gets admitted somewhere, the journal is requested - the original or copies, as needed. That means the journal format needs to be transportable, including to places that do not have access to the same system for whatever reason, and including overseas.

* Journals need to be accessible. Always. Even when the network is down, even when there is no power and normal backup power is failing.

Taken together it means at the minimum that irrespective of any electronic system, a "working set" of patients' journals need to always be available in paper copy, and that paper copy will need to be kept in sync with the electronic journal. Even if an electronic system is fully implemented, the visible bit for us as patients will probably continue to be pieces of paper.

Jun Okumura said...

Janne: I always enjoy your comments even when I disagree with them (particularly since the latter makes me do more thinking), but they are even more welcome when they reflect your area of professional expertise, which I understand to be relating information technology to real-world situations. Here are my humble comments to your comments:

* The journal needs to be complete; that means not only easily digitized pieces of paper, but also X-rays and test results (which often still are not generated digitally). It means you will need to be able to efficiently and most of all completely correctly digitize millions and millions of existing records. Until that can happen, digital records will be adjunct to the paper ones.So true. But given the falling costs of information technology, I think that it’s an undertaking that deserves to be explored, including the possibility of modularization, so that it can be adopted piecemeal, with less but earlier efficiency gains.

* People need to be able to enter journal data away from a desk or a computer. A sketch on paper; a hand-drawn diagram; a torn page from a notebook with scribbled vital signs during an on-site emergency all need to be efficiently and quickly entered as needed. With a paper journal that note simply goes into the file.

I see your point. Ultralight sketchpads will be essential equipment for EMT teams and ambulances.

* Journals need to be able to travel. When a patient gets admitted somewhere, the journal is requested - the original or copies, as needed. That means the journal format needs to be transportable, including to places that do not have access to the same system for whatever reason, and including overseas.

It is likely that many such places will have difficulties accessing the hardcopy version as well. In fact, I suspect that the Internet reaches many places that are hard, if not impossible, to access by snail mail, or even fax.

* Journals need to be accessible. Always. Even when the network is down, even when there is no power and normal backup power is failing.Accessing journals will be the least of concerns in a hospital when even the backup power system is failing.

Taken together it means at the minimum that irrespective of any electronic system, a "working set" of patients' journals need to always be available in paper copy, and that paper copy will need to be kept in sync with the electronic journal. Even if an electronic system is fully implemented, the visible bit for us as patients will probably continue to be pieces of paper.There may be a case to be made for a backup, simultaneously-generated hardcopy system. But that does not mean that it must of necessity be the primary interface for the patient.

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