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Biomedical Engineering, Vol. 36, No. 6, 2002, pp. 344-347. Translated from Meditsinskaya Tekhnika, Vol. 36, No.

6, 2002, pp. 40-44.

Original article submitted March 21, 2002.

Economics and Organization

Systems Analysis and Simulation of Regional Health Service
L. Ya. Bukharbaeva

Public health service is a complicated social system

for protection of peoples health. According to the WHO,
the efficiency of public health service is one of the main
factors determining the general state of health of a
population. Its contribution to the general state of health
of a population is assessed at 10-15%; other major
factors are the way of life (50-55%), environmental factors
(20-25%), and heredity (20%). A diagram shown in Fig.1
illustrates the interrelation between the factors determining the state of health.
On the other hand, public health service is a complicated sector of the national economy involving both
healthcare expenditure and profits due to restoration
of the ability to work.
Thus, public health service can be attributed to a
class of complicated systems possessing the properties
of memory, heredity, and delayed aftereffects [5]. These
properties are mainly due to human factor and they
affect such areas of public health service as investment,
control, stimulation measures, etc.
The theory of control systems can be used for
improving the structure and efficiency of the system of
health service management [1]. Health can be considered as one of the main factors determining the efficiency of social production. Development of this economical sector sets the following urgent problems:
development of models for assessing the resource
potential of health service;
development of methods for mathematical simulation of the health service system (for the purpose of
optimization of the management system).

As a preliminary stage to solution of these problems, systems analysis of health service management
should be performed. The goal of systems analysis is
to determine the optimal ways of development of the
health service system providing maximal social and
medical efficiency and minimal expenditure of all types
of resources (physical, manpower, intellectual, innovational, financial, information, etc.).
Cognitive structuring (one of the methods of systems
analysis) is a useful method for imaging and analysis of
systems [1]. It is a modification of the graph theory method
for simulation of problematic situations in socioeconomic
systems. The goal of cognitive structuring is to generate
and refine hypotheses concerning functioning of the object
under consideration. The object is considered as a complicated system involving various elements, subsystems,
factors, variables, etc. A structural diagram of causeand-effect relations is constructed to analyze the functioning of the complicated socioeconomic system.
The diagram shown in Fig. 1 can be considered as
a cognitive map representing the cause-and-effect relations between various factors. If the contributions of
two factors are directly proportional to one another,
the link between them is labeled with +; if inversely
proportional, . The cognitive map includes several
loops: some of them (positive feedback loop) enhance
factor divergence, while other loops (negative feedback
loop) reduce it. The majority of feedback loops are
positive, which shows that the system under consideration is unstable and constantly developing.
Under conditions of centrally planned economy, state
budget was the main source providing funding of the
public health service. Crisis of national economy and
budget deficiency resulted in financial and economic
crisis of the public health service. This crisis can be

Ufa State Aviation Technical University, Ufa, Russia; E-mail:

0006-3398/02/3606-0344$27.00 2002 Plenum Publishing Corporation

Simulation of Regional Health Service Management


H erot

Fig. 1. System of factors determining the general state of health of a population.

resolved only by reforming the economic relations, partial

privatization of state property, and wide introduction of
insurance medicine. The budget-insurance model of
functioning of regional public health service determines
the following four finance sources for public health:
republic foundation for obligatory medical insurance (FOMI);
voluntary insurance foundations (VIF);
private means of people (commercial medicine).
The first source (budget) provides 70% of the financing; VIF, 3-4%; the contribution of commercial
medicine is 1.5% of the total financing amount [6].
The cognitive map shown in Fig. 2 can be used for
the analysis of the financial infrastructure of public
health service management. The multicomponent system of financial management of public health service
includes finance sources and other functional subsystems
and consists of a number of positive and negative feedback loops. The problem of optimization of the financing system is one of the most urgent problems of regional public health service.

The problem of optimization of relationship between

different sources of funding and effective use of each
source of funding under conditions of funding cuts is a
serious problem of the republic level of responsibility.
Public health service is a subsystem of the community, the main purpose of which is to preserve and
improve public health by providing medical service,
hygienic and sanitation control, lecturing, etc. The
experience of many countries showed that market
economy alone (i.e., without state support) was unable
to provide effective functioning of public health service
systems [6]. For example, hygienic and sanitation
control, prevention of infectious diseases, epidemiological control, etc. are not social commodities. It is obvious
that such services should be managed and funded by the
state. Such measures are usually implemented in large
territory and funded by budgets of different levels.
Effective management of budget funding is a sufficiently complicated and important problem. Limited
budget resources make it necessary to optimize funding
distribution between medical organizations to attain the
maximum social effect. The multilevel organization of



Fig. 2. Cognitive map illustrating the financial infrastructure of public health service management.

the budget system makes it necessary to take into account

the interests of various sides in public health planning.
In this work we considered optimization models of
budget funding management in public health. These
were models of optimal planning of public health
As noted above, public health service measures
should be managed and funded by the state. Usually,
the public health service measures of that type are funded
by budgets of different levels and managed by special
managing organs.
To construct optimization models of budget funding management in public health, let us introduce the
following definitions:
M 1, ..., Mi, ..., M r is the list of measures that can
be implemented in a given territory; Bi is the cost of
the ith measure; P1, ..., P j, ..., P n are the budget representatives interested in implementation of given
measures; R are the financial resources of the managing organ itself; Y = (y1, y 2, ..., y r) is the vector of
priority of managing organ.
Let the program of measures be determined as the
following vector: g = (g 1, ..., g i, ..., g r), where
gi =

1, if the ith measure is included in the program

0, otherwise

Under conditions of limited resources there is a

problem of selection of an optimal set of measures from
the list of possible measures in order to provide optimal
funding of all sides under conditions of limited resources.

Model 1 (minimum rights of budget representatives)

Let us introduce the following additional definitions:
W j is the funding provided by each representative
Wj :



to implement the program of measures;

X j = (x j1, ..., x ji, ..., x jr) is the vector of priority of
the jth representative;
Q j is the priority of each representative defined by
Eq. (1):





It is necessary to compile the program capable of

providing the maximum extent of satisfaction of all
participants and managing organ with resources:

Q x


gi +

y g

max .

Under conditions of limitation:

g B W



It follows from Eq. (2) that the problem of optimization of the program of measures is a problem of

Simulation of Regional Health Service Management


linear integer programming. The rights of the representatives in this problem are reduced to a minimal

administrative districts and 14 towns. These republic

subjects are able to provide funding of various sanitation-epidemiological measures, e.g., against tic encephalitis and hemorrhagic fever, which are quite
common in this region.
A model of the process of medical service price
formation with regard for the risk factor was developed
[3]. This model is presently implemented as a part of
the information system for management of the Dental
out-patient clinic, Bashkir State Medical University.
The model of financial flow management is the most
important element of the system for public health service management by VIF [2]. This model is used by
the Sotsinvest insurance company in the Republic of
A model for optimizing the relationship between the
financial flows of regional FOMI and VIF is currently
under development [4]. In the Republic of Bashkiria
these financial flows are separated, which makes it
especially important to provide their optimal correlation.
Thus, systems analysis of the financial infrastructure of the regional public health service revealed several
important problems, such as the problem of simulation
of financial flows for each of the four financial sources
and determination of their optimal correlation. Implementation of the developed models allows the efficiency
of public health service to be improved. Scientific and
applied research into these problems is performed at
the Laboratory for Simulation of Biological and
Biotechnical Systems, Ufa State Aviation Technical

Model 2 (significant rights of budget representatives)

In this variant, budget representatives exert a significant effect on program formation through the maximum volume of the funding allocated to implement each
measure. The managing organ distributes its own funds
over deficient programs.
Let Sij be the maximum volume of funding allocated
to measure M i by representative P j
B j
Vi =


, if B j



0, otherwise

where V 1 is the deficiency of the

If V i = 0 then g i = 1, i.e., the
in the program.
M d is the set of measures, in
Therefore, own funds should

Y g

i : Mi Md

ith program.
measure is included
which V i > 0.
be allocated as fol-

max .

In case of limitation (3)

g V R

i : Mi Md


the funds of the managing organ belonging to the set

M should be allocated as to take into account the interests
of the managing organ (3). It follows from Eq. (3) that
it is a problem of linear integer programming.
Depending on specific conditions, one or another
model can be used.
Thus, the process of the use of budget funds and
formation of program is rather a complicated problem
associated with distribution of financial resources under
conditions of limited funding. This problem can be
solved using the optimization models described above.
These models proved to be particularly effective in the
Republic of Bashkiria, which includes more than 50



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