Health economics is the field that examines how resources are allocated in healthcare, and how those determinations affect people, institutions, governments, and society. It deals with how to best make use of limited resources to improve health outcomes, how to align values with decisions about sustainability, equity, and efficiency in health systems.

Every nation faces difficult choices about addressing healthcare such as which services to fund, how to assess the fair price of a drug, or how to educate and compensate physicians. Health economics provides evidence to help inform decision making regarding these difficult choices by examining costs and associated benefits and trade-offs. For instance, should a public payer fund a new cancer drug that is costly and treats only small number of patients? Health economists look at the situation by assessing the cost of a treatment against how much it improves the quality of life or years of life expectancy.

Health economics examines the impact of inequality on health. People from lower socio-economic backgrounds generally report worse health status outcomes and have less access to care. In order to understand inequity, health economists observe patterns of access and use and provide evidence that helps to create policies (insurance schemes or public health initiatives) that aim to decrease health inequities and provide equitable access.

Preventive care is another central focus. Health economists put value on the long-term savings of investments in vaccinations, access to clean water, mental health support, or anti-smoking campaigns. Many times, the costs of these preventive investments are less than the costs associated with treating a developing disease.

In your daily life, health economics is everywhere. It determines what medications are available, how long you wait for surgery, and even how much you pay for a visit with your doctor.

To wrap up, health economics is about making good, just decisions in medicine and public health; its role is to make sure that limited resources are being used efficiently, effectively, ethically and cuts lives lost, suffering shortens lives lost, sufferings diminish and enhances total quality of life for everyone—especially within systems where not everyone experiences this affliction privately.