Applying cost minimization techniques to hospitals: A comment

In a challenging paper, [Suthummanon S., Omachonu V.K., 2007. Cost minimization models: Applications in a teaching hospital. European Journal of Operational Research 186, 1175-1183] (hereafter SO), present an interesting cost minimization model to be applied to improve hospital efficiency. Though the technical aspects of the statistical analysis SO present cannot be criticized, it is argued that the application to hospital costs the authors present is fraught with conceptual and practical problems. These need to be resolved before a length of stay approach to minimizing hospital costs can have any practical relevance.