Reducing Costs of Managing Medication Inventory in Automated Dispensing System in Hospital Units

8 Pages Posted: 14 Jul 2018

See all articles by Gregory Dobson

Gregory Dobson

University of Rochester - Simon Business School

Sandy Sullivan

University of Rochester - Department of Pharmacy

Vera Tilson

University of Rochester - Simon Business School

Dave Webster

University of Rochester - Department of Pharmacy

Date Written: June 22, 2018

Abstract

Hospital pharmacies utilize automated dispensing systems (ADS) to store and dispense medication in hospital wards. We propose an algorithm to minimize the inventory management costs incurred in holding and refilling the medications stored in an ADS. The algorithm is a linear integer programming formulation to compute how to configure an ADS, and how to allocate medications into capacity-constrained containers. Using a numerical example with real hospital data we demonstrate significant percentage savings relative to the status quo.

Keywords: Hospital Pharmacy Inventory Management, Automated Dispensing Units, Joint Replenishment Under Stochastic Demand and Storage Constraints

JEL Classification: M11, M15

Suggested Citation

Dobson, Gregory and Sullivan, Sandy and Tilson, Vera and Webster, Dave, Reducing Costs of Managing Medication Inventory in Automated Dispensing System in Hospital Units (June 22, 2018). Available at SSRN: https://ssrn.com/abstract=3201330 or http://dx.doi.org/10.2139/ssrn.3201330

Gregory Dobson

University of Rochester - Simon Business School ( email )

Carol Simon Hall 3-310
Rochester, NY 14627
United States
585-275-2670 (Phone)
585-442-6652 (Fax)

Sandy Sullivan

University of Rochester - Department of Pharmacy ( email )

Rochester, NY
United States

Vera Tilson (Contact Author)

University of Rochester - Simon Business School ( email )

Rochester, NY 14627
United States

Dave Webster

University of Rochester - Department of Pharmacy ( email )

Rochester, NY
United States

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