A model of supply‐chain decisions for resource sharing with an application to ventilator allocation to combat COVID‐19

We present a stochastic optimization model for allocating and sharing a critical resource in the case of a pandemic. The demand for different entities peaks at different times, and an initial inventory for a central agency are to be allocated. The entities (states) may share the critical resource wi...

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Vydané v:Naval research logistics Ročník 67; číslo 5; s. 303 - 320
Hlavní autori: Mehrotra, Sanjay, Rahimian, Hamed, Barah, Masoud, Luo, Fengqiao, Schantz, Karolina
Médium: Journal Article
Jazyk:English
Vydavateľské údaje: Hoboken, USA John Wiley & Sons, Inc 01.08.2020
Wiley Subscription Services, Inc
Predmet:
Confidence intervals
Cost benefit analysis
COVID-19
Demand
Economic forecasting
emergency management
mixed‐integer programming
Optimization
Pandemics
resource sharing
Risk management
stochastic programming
Stockpiling
ventilator allocation
Ventilators
mixed‐integer programming
COVID‐19
ventilator allocation
resource sharing
stochastic programming
emergency management
ISSN:0894-069X, 1520-6750, 1520-6750
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Shrnutí:We present a stochastic optimization model for allocating and sharing a critical resource in the case of a pandemic. The demand for different entities peaks at different times, and an initial inventory for a central agency are to be allocated. The entities (states) may share the critical resource with a different state under a risk‐averse condition. The model is applied to study the allocation of ventilator inventory in the COVID‐19 pandemic by FEMA to different U.S. states. Findings suggest that if less than 60% of the ventilator inventory is available for non‐COVID‐19 patients, FEMA's stockpile of 20 000 ventilators (as of March 23, 2020) would be nearly adequate to meet the projected needs in slightly above average demand scenarios. However, when more than 75% of the available ventilator inventory must be reserved for non‐COVID‐19 patients, various degrees of shortfall are expected. In a severe case, where the demand is concentrated in the top‐most quartile of the forecast confidence interval and states are not willing to share their stockpile of ventilators, the total shortfall over the planning horizon (until May 31, 2020) is about 232 000 ventilator days, with a peak shortfall of 17 200 ventilators on April 19, 2020. Results are also reported for a worst‐case where the demand is at the upper limit of the 95% confidence interval. An important finding of this study is that a central agency (FEMA) can act as a coordinator for sharing critical resources that are in short supply over time to add efficiency in the system. Moreover, through properly managing risk‐aversion of different entities (states) additional efficiency can be gained. An additional implication is that ramping up production early in the planning cycle allows to reduce shortfall significantly. An optimal timing of this production ramp‐up consideration can be based on a cost‐benefit analysis.
Bibliografia:Funding information
National Science Foundation, CMMI‐1763035
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Funding information National Science Foundation, CMMI‐1763035
ISSN:0894-069X
1520-6750
1520-6750
DOI:10.1002/nav.21905