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Michele R. Morris HCS/ April 25, 2011 Instructor Name History and Evolution of Health Care Economics History and Evolution of Health Care Economics Over the course of history in the United States, the economics of health care has changed.

Economics is the science that deals with the production, distribution, and consumption of goods and services, or the material welfare of mankind (Getzen & Moore, 2007). This paper will discuss that history along with the evolution of heath care economics. This paper will also discuss the timeline of health care funding.

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Some factors that contributed to the evolution of health care are technology and medical advancement. If one understands the flow of funds system and the history of health care economics there would be an easier task of planning for the future. Money is the driving force when it comes to health care economics. Over the past 60 years health care funding has changed. In the past a larger number of individuals paid privately for health care. Over the years Funding began to come more from third party agencies and health insurance companies.

That leaves individuals paying only a portion of the total flow of funds with private money (Getzen & Moore, 2007, p. 3, para. 1). Flow of Funds The flow of funds is a system that is used.

This flow of funds system is a system in which financial managers can determine the flow of finances through the health care system. Before the Great Depression people were known to trade physical items for health care. These items consisted of livestock, cotton, and other items that might have been worth something at that time. During this time period people were essentially paying 100 ercent of medical cost. After the World Wars a new system needed to be implemented so that people could get medical care.

After these hard times it was necessary for some financial aid to the people. The Depression Around the 1930’s the Great Depression had forced changes in the economics of health care. During this time frame priorities changes as far as health care was concerned. The focus now became more on unemployment and benefits for the elderly (PBS, 2010). Of course with such unemployment people could no longer be 100 percent financially responsible for medical care.At this time the social security act was passed omitting health insurance. Though there was some discussion about health insurance the government at this time wanted to focus on the priorities.

The priorities being unemployment and elderly care as stated above. Also around this time Blue Cross, a now well known insurance company, started offering private coverage for hospital coverage to dozens of states against the advice of insurance professionals (PBS, 2010). World War II Moving forward about ten years, after World War II, Penicillin comes into use.This is an example of a medical advancement.

Also around the 1940’s prepaid group health care begins. Wage and price controls were placed on American employers. President Roosevelt asks congress to pass a bill of rights that would allow adequate health care. Next President Truman would offer a national health program plan. This plan is denounced by the American Medical Association. Present Time Over the years the state of the economy has changed along with technology, medical advancements, disease, and population.

All of these factors determine what changes have been made throughout history. These factors have caused the evolution of health care economics. In present times health care cost are on the rise.

Some think that Medicare needs to be rescued. Changing demographics in the workplace make some believe that employers will no longer be able to offer group insurance. So what is the answer? How can we balance the economics of health care? This is a question that may never be answered. Conclusion Everybody has different opinions about health care.

Based on the time line of health care the economics will continue to change. We can only hope that it will change for the better. This paper has discussed the history and evolution of health care as well as the time line of health care funding. References Getzen T. E.

, 1807-2007, (Health Care Economics), (Temple University with Bruce Allen), University of Phoenix Materials, Received 4/19/11   PBS. (2010). Health Care Crisis. Retrieved from http://www. pbs.

org/healthcarecrisis/history. htm

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