A Two-stage Stochastic Variational Inequality Model for Storage and Dynamic Distribution of Medical Supplies in Epidemic Management

Li, Min; Zhang, Chao; Ding, Mingxv; Lv, Ruipu

The storage and distribution of medical supplies are important parts of epidemic prevention and control. This paper first proposes a new nonsmooth two-stage stochastic equilibrium model of medical supplies in epidemic management. The first stage addresses the storage in the pre-disaster phase, and the second stage focuses on the dynamic distribution by enrolling competitions among multiple hospitals over a period of time in the post-disaster phase. The uncertainties are the numbers of infected people treated in multiple hospitals during the period of time, which are time-varying around a nominal distribution predicted by historical experience. The two-stage stochastic equilibrium model is further approximated and transformed to a monotone two-stage stochastic variational inequality (SVI) model that is computationally tractable, with the aid of a smooth approximation technique. We employ the progressive hedging method (PHM) to solve a case study in the city of Wuhan in China suffered from the COVID-19 pandemic. Numerical results are presented to demonstrate the effectiveness of the proposed model in planning the storage and dynamic distribution of medical supplies in epidemic management.