Economic Terms and Health Care History

Economic Terms and Health Care History In this paper the author will describe the history of health care economics along with the evolution and timeline of health care funding. Gaining insight from economical terms can assist with understanding the history and future changes; terms such as, elasticity, inelasticity, supply and demand. Health care costs are changing over the years and by understanding the history of health care economics will help individuals be prepared for future amendments. History, evolution and timeline of funding. Economics in the United States (US) health care is experiencing transformations during the course of history. Previously, the economical changes in health care may be due to the evolutionary modifications in the US. The key contributing causes for economic health care changes are the advancement of technology and how medical treatment is offered. In the late 1800’s is when America began to see the formation of medical profession. The education practices for physician became formal and arrangements for hospital structures began (Wasley, 1993). By the early 1900’s America was the largest population to have hospitals. However during this time the U.S. encountered an economic decline that involved a stock market crash; this incident was known as the Great Depression. The outcome of this event made it hard for American citizens to pay for their medical care. Hospitals with higher fixed cost had less flexibility for patients than doctors who made allowances for financially stricken. The hospital’s decrease in patient payment went from receiving $200 for each patient to $60 per patient. The reduction in funds caused hospitals to seek out insurance plans. The plans would help the hospital have a steady cash flow without having financial problems later (1993). The creation of insurance plans was done in several different cities by nonprofit hospitals. To strengthen the income and increase patient