With the help of a combined cycle model, the effect of the irreversibility of finite-rate heat transfer on the performance of a two-stage combined heat pump system in steady-state operation is investigated. The optimal coefficient of performance of the combined heat pump system is derived for a given specific heating load. The optimal relations between the temperatures of the working fluid in heat exchangers and the coefficient of performance or specific heating load are found. The optimal distribution of heat exchanger areas is determined. Finally, a simple equivalent system is given.