Central Hospital Location and Distribution Planning Using Integrated K-Means and Vehicle Routing Algorithm in the Healthcare Chain

Abstract

A healthcare chain (HC) involves interrelated activities inclusive of medicine manufacturing, storage, and last-mile distribution to drug retailers and users. Major decision-makers in the HC are also interrelated, in which proper management and planning for logistics activities are required to enhance efficiency and effectiveness. In this study, we first investigate the optimal locations of central hospitals using the K-means algorithm at the midstream of the healthcare chain for long-term planning. Next, we assess the distribution plan of medical supplies by integrating the capacitated vehicle routing problem (CVRP) model with a limited time planning horizon, in which the total economic aspect is evaluated for the short-term plan. Then, our integrated framework is applied to a case study of existing hospitals in Thailand to verify and validate model functionalities. We then examine both locational and distribution plans and present our findings using the geographic information system (GIS). The sensitivity analysis is further performed to evaluate the clustering classification scheme for central hospitals and to evaluate the impact on healthcare logistics plans.