Healthcare Supply Chain

Cho, Soo-Haeng; Zhao, Hui

doi:10.1002/9781119300977.ch8

Cited by 5 publications

(2 citation statements)

References 26 publications

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“…In the context of flu vaccine supply chain, several studies examine the coordination issues between firms (e.g., manufacturer, healthcare provider, etc.) in the presence of uncertain yield (Cho and Zhao 2018).…”

Section: Related Literature and Contributionsmentioning

confidence: 99%

A Two-Sided Incentive Program for Coordinating the Influenza Vaccine Supply Chain

Arifoğlu

Tang

2022

M&SOM

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Problem definition: The U.S. influenza (flu) vaccine supply chain is decentralized and experiences frequent supply and demand mismatches caused by two key factors: (1) the vaccine production process (yield) is highly uncertain; and (2) individuals are self-interested and do not completely take into account positive and negative externalities that they impose on others. To improve matching of supply and demand, we counteract these factors by developing an ex ante budget-neutral incentive program. Academic/practical relevance: We establish the sources of inefficiency in the flu vaccine supply chain. To eliminate the inefficiency, we develop a two-sided incentive program that policymakers can implement to finance vaccines under an ex ante balanced budget. Methodology: We model the flu vaccine supply chain as a decentralized system consisting of self-interested individuals on the demand side, and a profit-maximizing manufacturer with uncertain yield on the supply side. We use backward induction to characterize the subgame-perfect equilibrium of the sequential game that models the interactions between individuals and the manufacturer. Results: We develop a two-sided incentive program that proposes “vaccination incentives” to be given to individuals on the demand side, and “a menu of transfer payments” between the social planner and manufacturer on the supply side. When the realized vaccine supply is high (or low), our incentive program provides positive (negative) vaccination incentives for individuals to stimulate (or curb) the demand and eliminate positive (or negative) externalities by making vaccination more affordable (or costly). When social benefits from vaccination are significantly high, our incentive program uses a menu of transfer payments to penalize (or subsidize) the manufacturer for low (or high) yield realizations so that it produces the socially optimal quantity. We show that our incentive program can attain the social optimum, maintain an ex ante balanced budget (i.e., budget-neutral in expectation), and distribute the maximum social welfare between individuals and the manufacturer arbitrarily. Managerial implications: Vaccination incentives to individuals can ensure their access to the vaccine, but they are not enough to entice the manufacturer to ensure vaccine availability. A menu of contracts contingent on realized yield provides necessary incentives to the manufacturer and assures the availability.

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Section: Related Literature and Contributionsmentioning

confidence: 99%

A Two-Sided Incentive Program for Coordinating the Influenza Vaccine Supply Chain

Arifoğlu

Tang

2022

M&SOM

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“…During the past several years, there has been an increase in scholarly work targeting healthcare, and considerable emphasis has been placed on improving healthcare operations to reduce costs (Dai & Tayur, 2019; Cho & Zhao, 2018). At the same time, the risks associated with the healthcare industry remain to be fully addressed even though the industry is facing an increasing array of daily risks.…”

Section: Introductionmentioning

confidence: 99%

Mitigating the risk of blood shortage

Fortsch

Khapalova

Carden³

et al. 2023

JBSE

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PurposeThe objective of this study is to mitigate the risks of a blood shortage. The authors designed two simulation studies to identify the superior methodology that can decrease the impact of a massive national donor shortage.Design/methodology/approachThe simulation designs are triggered by the COVID-19 pandemic. The first simulation examines the company’s choice of strategic partners (regionally and nationally), and the second inspects creating a national coordinated effort to organize a pooled blood inventory that would require blood centers to contribute a small percentage of their monthly donations to become a member.FindingsThe results indicate that both methods can significantly manage the risk of stockouts regardless of the availability of safety inventory in a blood center; however, although more effective in reducing the number of shortages per month, creating a national blood pool causes the shortages to be recognized earlier than desired.Originality/valueThe authors contribute to the literature by focusing on the potential risk of blood shortage because it directly impacts healthcare, hospitals’ costs and their ability to provide care. Though a handful of researchers have targeted the study of the blood supply chain, there is not any article that is similar to this study.

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Pharmaceutical Supply Chains and Drug Shortages

Zhao

2023

Tutorials in Operations Research: Advancing the Frontiers of OR/MS: From Methodologies to Applications

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Healthcare Supply Chain

Cited by 5 publications

References 26 publications

A Two-Sided Incentive Program for Coordinating the Influenza Vaccine Supply Chain

A Two-Sided Incentive Program for Coordinating the Influenza Vaccine Supply Chain

Mitigating the risk of blood shortage

Pharmaceutical Supply Chains and Drug Shortages

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