Health economics is the study of how limited resources are used in the health care industry and how they affect health care systems. It aims to provide the best quality health care to as many people as possible given financial constraints. Key aspects of health economics include cost accounting, cost-benefit analysis, cost-effectiveness analysis, and analyzing the effects of factors like technology, population changes, and policies on health care systems. Resources in health care may be evaluated using quantitative techniques like cost minimization and cost-effectiveness analysis.

2. • Health economics is an economic
system related to medical, health and
family welfare services.

3. • Health is the state of complete
physical, mental, social, spiritual
wellbeing. Not merely absents of
disease or infirmity. (WHO)

4. • The term “Economics” is taken from
Greek word “Oikos” means
household and “Nomos” means
management. So, managing the
things using the funds available in
the most economical manner as
possible.

5. Study of wealth
• Economics as a science which studies
the nature and causes of national
wealth.
Adam Smith

6. Study of welfare
• A study of mankind in the ordinary
business of life; it examines that part of
the individual and social action which is
most closely connected with the
attainment and use of the material
requisites of wellbeing.
Marshall

7. Study of scarcity
• The science which studies human
behavior as a relationship between
ends and scarce means which have
alternative uses.
Robbin

8. • Health economics is concerned with the
use of resources affect the health care
industry. (Jacobs-2002)
• Health economics is the discipline
that determines the price and the
quantity of limited financial and non-
financial resources devoted to the care of
the sick and promotion of health(Gupta
&Mohanjan-2003)

9. • To provide the best quality health
care to the largest number of people,
given available financial resources.

10. • Cost Accounting
• Cost – benefit Analysis
• Cost – effectiveness Analysis
• Marginal Analysis

11. • Price Inflation
• Changes in population demography
• Technology
• Chronic illness
• Lack of education
• Environmental degradation
• Ignorance and lethargic attitude

12. • PUBLIC SUPPORT
• PRIVATE SUPPORT
– Insurance
– Employers
– Individuals
– Managed care arrangements
– Medical saving account

13. • Paying health care organizations
– Retrospective reimbursement
– Prospective reimbursement
– Cost- plus reimbursement
• Paying health care practitioners
– Fee - for – service
– Capitation

14. • Cost sharing
• Health care alliances
• Self insurance
• Flexible spending accounts

15. • The outcomes of resources in health care
may be measured by quantitative
technique like Cost minimization: in this
cost of implementing two systems or
programs or treatment regime is
compared. The results (outcomes) of
both these intervention may be the
same.

16. • Cost-effective analysis: outcomes assumed
in non-monetary units. This helps a planner
to compare between two programs with the
same objective and find out which program
achieves the health objectives at the least
cost

17. Technology is a crucial ingredient of
health care. Major regulatory frameworks and
institutions exist solely to manage the
introduction and use of safe, effective and
efficient technology in health care. The health
and medical research and development sector,
from which advances arise, has a high public
profile in its own right. Finally, there is great
community interest in technology, especially
technology that has important implications for
health.

18. Health technology defined as
"application of organized knowledge and
skills in the form of devices, medicines,
vaccines, procedures and systems developed
to solve a health problem and improve
quality of lives." This includes the
pharmaceuticals, devices, procedures and
organizational systems used in health care.
WHO

19. • Medical technology, which is a proper
subset of health technology, encompasses
a wide range of healthcare products and is
used to diagnose, monitor or treat diseases
or medical conditions affecting humans.

20. • The work of these professionals encompasses
clinical applications of chemistry, genetics,
hematology, immunohematology (blood
banking), immunology, microbiology, serology,
urinalysis and miscellaneous body fluid
analysis.