Terms Comparison Paper

HCS 552
October 10, 2011
Harry Morris

Terms Comparison Paper
Economics is the study of supply and demand and the affect that these interactions have on resource allocation (Getzen, 2007). The basic concepts economics can be connected to the health care industry and used as a means to assess prospects when distributing resources. Health economics is a branch of economics focused on evaluating shortage in health care systems in different economies (Investorworks.com, 2011). Health economics seeks to identify problem areas in a health care system and propose solutions for issues by evaluating all possible causes and solutions. There are many terms that are used that relates both to health care and economics in which results in Health Economics. Health care in the future will focus on both disciplines and will shape how physicians and insurance companies will determine how and what will be provided to the community. In this paper, the terms utility, resources, and risk will be discussed in terms on how they compare and differ in relations to health care and economics.
Utility
In economics, Utility means the ultimate satisfaction received from consuming a product or service. This could mean that when a person buys an expensive car and drives it on the highway, the person the will feel utility when others look at the person driving the car. Measuring a person’s utility is looking at a person’s drive and determination in reaching the maximum utility for a person. Looking at behaviors is one way of measuring a person’s utility. In comparison to health care, a person’s utility is prime values that represent the power of an individual’s preferences for specific health-related outcomes (Tolley, 2011). In health care, utility is the health of a person. Smoking and drinking can hinder the person’s pathway in reaching utility The resource allocated to reach this full utility depends on what resources are available and how the person pursues them to reach maximum health. Preventive health care and available resources can determine if the person will reach the goal.
Resources
According to the Investorwords.com (2011), “Resource is a person, asset, material, or capital which can be used to accomplish a goal (para. 1). Examples of resources are land, capital, energy, management, and time. These resources will help a person accomplish what he or she needs to reach a certain goal. In economics, having the most efficient resource in reaching a goal is accomplishing. In health care, resources are having available and competent medical staff (physicians and nurses), medical supplies, monetary means of affording health care, insurance, and preventive health care. In economics, the suppliers are the producers and the costumers or buyers are the consumers. In health care, the medical staff (physicians, nurses, technicians) is the producers. The patients are the consumers who demand a service or product from the producers with the most efficient resources. The ultimate goal of efficient resource allocation is to meet the ever ending demands of the consumers with the limited supplies or monetary means available at that time.
Risk
In economics, risk can be simply explained as the product’s output will not produce enough profits to cover operating costs. Starting a business and producing a product all involves risks. It can be unwanted event that may or may not occur during the process. It frequently leads to devastating loss to the company. In corporate world, risk management means identifying, monitoring, limiting or eliminating these unforeseen events that may occur. The goal is to prevent loss and damage to the company. In health care, a patient comes to the doctor or hospital for help to get well. The number one risk to the patient in the hospital is the patient’s safety. Procedures that are established must take into account a patient’s safety at all times. Physicians, nurses, and technicians play a huge part in the element of risk in health care. Not being properly trained or incompetent can cause a staff member in making a mistake which may result in injury or death to the patient. As in the economic world, risk management is put in place in the health care setting to identify, monitor, or limit these risks. Risk management procedures are constantly reviewed and revised as needed to provide optimum care with the lowest amount of risk across all areas throughout the organization.
Conclusion
Economics and Health Care Economics function on the same platform. Both disciplines operates in reaching a goal by allocating the most useful and efficient resources to reach the best outcome for both the company and the patients. Thinking in economic terms paves the way for the decision making process in any health care setting. By using economics thought and procedures, a patient can receive the most out of health care by utilizing the available resources efficiently and effectively with little or no cost. Resources, utility, and risk are important terms used in both economics and health care. Each term has basically the same foundation meaning in both disciplines and intertwines with one another in relation to reaching optimum health for patients.

References
Getzen, T. E. (2007). Health economics and financing (3rd ed.). Hoboken, NJ: John Wiley & Sons, Inc.
Investorwords.com. (2011). Definition of health economics. Retrieved from http://www.investorwords.com/7952/health_economics.html
Investorwords.com. (2011). Definition of resources. Retrieved from http://www.investorwords.com/4217/resource.html
Tolley, K. (2011). What are health utilities? Retrieved fromhttp://www.medicine. ox.ac.uk/bandolier /painres/download/whatis/Health-util.pdf