OBJECTIVES: A literature review identified that constrained resource models of service delivery and organisation do not include patient-based outcomes. The aim of this study is to develop an evidence-based framework representing costs and health benefits, to inform best use of constrained health care services in a routine clinical setting.  METHODS: A discrete event simulation (DES) model was developed to represent the use of glaucoma services at the Royal Adelaide Hospital. The DES describes disease progression and pathways of care, where disease progression is influenced by the frequency and content of hospital visits, and vice versa. Individuals, who are competing for access to hospital services, are assigned characteristics that represent relevant patient and disease characteristics. Across all individuals, these data inform the demand for services over time, which is combined with information on the supply of available resources within the system to analyze alternative approaches to the use of available resources.  RESULTS: The base case model has been validated against hospital data representing both process and clinical measures over time. Analysis of the model shows variation in the total QALYs gained by cohorts of glaucoma patients over their remaining lifetime, according to alternative treatment decision algorithms (e.g. medication versus surgical intervention); surveillance and imaging algorithms (e.g. variation in relative follow-up schedules for high and low priority patients).  CONCLUSIONS:   The applied framework illustrates the potential value of DES in modelling the costs and health benefits of alternative approaches to organising scarce physical resources, providing estimates of health gains that can be achieved in the absence of the introduction of new technologies.