What is health economics?

Selma Mushkin's paper (1958)* is probably one of the first papers mentioning the definition of health economics, and marked the boundary of health economics as a sub-discipline:

Health economics is concerned with the optimum use of scarce economic resources for the care of the sick and the promotion of health, taking into account competing uses of these resources. The basic problems are of two kinds: the organization of the medical market, and the net yield of investment in people for health.

Moreover, Mushkin explained why health economics merits becoming an sub-field:

Consumer preferences are not an adequate guide to the optimum allocation of resourcesfor health. There are a number of reasons why this is so. For one thing, a consumer would prefer to avoid the illnesses which require use of resources for health purposes. For another, his neighbors benefit from the medical services he purchases, for example,"flu shots" during the recent influenza epidemic. Individual decisions undervalue health services, and would result in under production of these services unless supplemented by actions of private voluntary agencies and government.

Of course, the field has been developing since 1958, and the coverage of study has been largely expanding.

*Selma Mushkin, "Towards a Definition of Health Economics," Public Health Reports, 1958, 73, 785-93.