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Politics, Economic Interests, and the Shaping of Health Policy

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Introduction

Any country's political and economic interests around the globe affect the country's

growth either directly or indirectly. Political factors determine the country's stability, while

economic interests determine revenue collection and growth. Health policy development is

highly intertwined with political and economic interests since the government must address

healthcare needs while ensuring political and economic stability. Therefore, this paper explores

the intricate relationship between politics, economic interests, and health policy by examining

historical examples. Furthermore, referencing Gordon's work, it explores how economic and

political decisions or considerations have shaped the health sector, resulting in significant

changes in the healthcare setup.

Examples of Healthcare Policy That Were Influenced by Political and Economic Interest

The Development or Implementation of Medicare and Medicaid in the United States

To begin with, the development or implementation of Medicare and Medicaid in the

United States in 1965 significantly influenced the health sector. During the tenure of President

"Lyndon B. Johnson," there was an initiative known as the Great Society Initiative aimed at

providing health care to vulnerable people in society. Especially the elderly (Medicare) and low-

income individuals (Medicaid) (Smith, 2020). Two political interests determined this decision:

one, responding to the pressure, and two, expanding society's safety net.

During this period, a growing demand for healthcare reforms was driven by various

political and non-political groups. Groups such as the American Medical Association, civil rights

groups, emerging social movement groups, and influence from media and research led to the

development of this healthcare reform. This group highlighted a disparity in the health sector,
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and individuals were not treated equally. As a result, there was a need for political leaders to

address this issue so that they could not only solve healthcare problems but also remain in power.

Another political factor was expanding the social safety net. The president knew addressing

critical issues such as health care would guarantee inequality through social welfare programs

(Smith, 2020). Consequently, Medicare and Medicaid were critical elements since they could

provide social equity and equal healthcare access.

On the other hand, economic factors influenced this healthcare policy since it could

create income through insurance policies and the hospital industry. Addressing this issue means

that insurance programs would rise directly as well. According to Smith (2020), as an economic

interest, it would increase revenue by providing coverage to previously insured patients. Another

economic interest was the partnership between private and public insurance companies. It was

clear that, due to congestion in public places, wealthy people would consider private ones, which

are pretty expensive.

Additionally, the legislation was designed to work with private insurance, creating a

mixed healthcare system that would accommodate both public and private interests. This action

would create jobs and create a more extensive revenue base. In addition, it would earn even more

interest from global investors due to the rise in demand for these insurance policies.

Another example is the social security act of 1935, which led to the establishment of a

social security program geared toward political and economic interests. During this age, the

United States grappled with the devastating causes of the Great Depression, which led to

widespread poverty and social inequality. In response to various groups' public outcry and social

unrest, the political climate was ready for comprehensive social reforms. The then administration

sought to address this alarming economic challenge to enhance the overall well-being of its
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citizens. The Social Security Act was significant, comprising various programs to enable social

protection and economic relief. The act included the Old-Age Insurance and Unemployment

Insurance programs.

The political interest behind the “Social Security Act" was twofold. Firstly, it is geared to

respond to or address public pressure and relieve the suffering caused by poverty and the high

unemployment rate during the significant depression period. The administration understood very

well that enacting comprehensive social insurance systems would guarantee public support and

bolster the political legitimacy of the administration. Furthermore, economic interests and

decisions influenced the act or the program. The Policymakers understood the importance of

stabilizing the economy by providing a safety net for retirees and the unemployed (Anderson,

2022). The government's establishment of the social insurance program was meant to reduce the

impact of economic downturns and protect the purchasing power of the elderly and unemployed,

aiding internal (domestic) consumption and economic recovery.

How Does This Political and Economic Interest Shape the Development and

Direction of Health Policy?

From the historical examples, it is clear that only altruistic ideas do not solely drive

health policies but are also influenced by pragmatic aspects such as political and economic

interest. The two aspects interplay and result in a balancing act to achieve policy objectives that

align with the country's political motivations and economic interests. However, this interest can

differ based on the specific health policy under consideration (Barr,2023). For instance, the

passage of Medicare and Medicaid in 1965, as previously explained, illustrates the critical effect

of political and economic interests on the healthcare policy development process.

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The political interest behind these programs was to respond to public pressure from

various bodies for comprehensive healthcare policy and expand the social safety net. At the same

time, economic interests from the hospital and insurance industries influenced the legislation to

ensure a steady flow of revenue and a mixed healthcare system that accommodated both public

and private interests. The establishment of Social Security exemplifies how politics and

economic interests interact in shaping the health policymaking process. The political interest in

addressing social inequalities and gaining public support by the administration converged with

the economic interest of stabilizing the economy and promoting domestic consumption and

growth.

Consequently, the Social Security Act had a transformative effect on the lives of millions

of Americans, providing financial security during retirement and unemployment and laying the

groundwork for future social welfare programs. Overall, the historical examples presented

indicate that political and economic interests shape health policy development and direction.

Policymakers must navigate the complex interplay of these interests to craft compelling and

equitable health policies that address the population's needs while considering economic realities

and political considerations (Lopez,2022). Understanding this dynamic relationship is crucial for

crafting sustainable and impactful healthcare reforms.

Conclusion

In conclusion, the development and direction of health policy in the United States are

inherently influenced by politics and economic interests. The historical example of the Social

Security Act of 1935 demonstrates how political motivations to address social challenges and

economic considerations to stabilize the economy converge to shape impactful health policies.
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More so, throughout history, politics and economic interests have significantly influenced health

policy development and direction.

More so, examples such as the Medicare and Medicaid programs. We can better

understand the continuous complexity of health policy and how it interacts with the more

excellent political and economic environment by understanding these past events. To establish

prosperous and egalitarian medical systems, administrators constantly need to weigh these

factors while maintaining the necessities of people at the core of their decision-making

procedures. However, as representatives keep debating the intricate details of healthcare changes,

understanding how politics and economics interact is still crucial for creating efficient and

equitable healthcare regulations that meet the needs of the American people.
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References

Smith, J. A. (2020). The Development of Medicare and Medicaid in the United States: Politics

and Economic Interests. Journal of Health Policy and Economics, 25(3), 123-14

Anderson, M. K. (2022). Politics, Economic Interests, and the Social Security Act of 1935: A

Historical Perspective on Health Policy in the United States. Journal of Public Policy and

Healthcare, 12(2), 78-96.

Barr, D. A. (2023). Introduction to US health policy: The organization, financing, and delivery

of health care in America. JHU Press.

Lopez, A. B. (2022). Retiring Social Security's (Non) Payment at Death after Eight

Decades. Emory LJ Online, 72, 14.

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