Michael Oberreiter, Head of External Affairs International at Roche, shared on LinkedIn:
“Sunday afternoons are a good time to let my brain wander off.
Next destination: is it time to move from health economics to the economics of health?
I’ve spent almost 30 years in pharma and healthcare, working in access and policy across developed and emerging markets. During this time, health economics methodologies and tools have taken over how we decide what happens to patients: HTA. Cost-effectiveness. Comparators. Endpoints. Thresholds. QALYs. Budget impact.
We built a super sophisticated system around deciding which innovation is worth paying for. But a fundamental tension is left unaddressed. Payers (hence the name) are asked to optimise a specific budget. But optimising a budget is not necessarily the same as optimising value. And it is certainly not the same as optimising the return on taxpayers’ investment in health. As Margaret Thatcher said (one of the few points I do agree with her):
‘There is no such thing as public money. There is only taxpayers’ money.’
So the question shouldn’t just be: How much does health innovation cost and what does it do to my health budget? It should be: What economic return do we (as a society) get from investing in it? Because the value of better health extends far beyond healthcare. People stay at work. Disability is avoided. Caregivers keep working. Families avoid the financial shock of illness. That is economic value too. Yet we rarely put the full equation together.
To be fair to payers, the system traps them. Government budgets speak different languages. The health budget carries all the visible cost. The benefits will show up somewhere else, in form of higher employment, less social care, more tax revenues or productivity gains. That makes the economics of health harder to see, not less real.
Which is why we need a health taxonomy: a standardised framework for classifying and measuring the economic value of better health across all public budgets. Just as green finance built a taxonomy to define ‘sustainable investment,’ we need a shared accounting language across government. One that lets Finance, Labor, and Health measure the true, cross-department yield of keeping people healthy.
Building this framework is not a job for payers. Governments need to do it. They are the only ones who can connect the value of better health across health, employment, social care, tax revenues and the wider economy. Until we have that, optimising the healthcare budget can still mean making the wrong decision for society.
So, I do think it’s time to change the lens.
From health economics to the economics of health.”
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