Pharmacoeconomics: Public Health vs. Public Money--Working as a Health Economist


Konrad Obermann studied medicine and economics in Bonn, Göttingen, Hannover, and Hartford (Connecticut, USA). He was awarded an M.D. in 1992 and a Ph.D. in economics in 1999. After clinical work in psychiatry and transplantation medicine, he specialized in health economics. A postdoctoral fellowship allowed him to do research as a visiting fellow at the Centre for Health Economics in York (U.K.). In 1997 he joined the Boston Consulting Group where he worked in the company's health care practice. At the beginning of 2000 he joined the Instiut für Gesundheits- und Sozialforschung (IGES) in Berlin, where he is responsible for health technology assessment.

If one looks back at the history of medicine, money has almost always been an important aspect in the care of sick people. In Greek and Roman times famous physicians could make a fortune providing specialist services. In the baroque age, after their medical education young men looked for lucrative assignments at a royal court or went abroad to make their fortune. During the golden age of the emerging field of clinical medicine in middle Europe in the 19th century, well-known surgeons and other specialists charged their patients according to income.

It was only in this century, and especially after the second World War, that wide-ranging social security systems were implemented with the idea that all "necessary care" should be free. However, some provisos had to be added almost right from the beginning. Today, there are three long-term developments that put pressure on the existing health care systems: demographic changes (more elderly, less young people), the advancement of high-cost medical technology, and rising demands by patients and their relatives. Increasingly, the available resources do not match the demands.

Health economics is a field poised between medicine and economics that applies the conceptual thinking and theoretical models of economics to the production and distribution of medical care. It is not simply a branch of economics (although some theorists might prefer to think so) as some of the fundamental axioms are different: A society's obligation to support the sick individual and the "just" (however defined) distribution of health care are of paramount importance here.

It is only natural that philosophers, physicians, and economists have all contributed to the principles and methodologies in health economics. And it becomes increasingly clear that there are no simple and quick solutions to overcome the scarcity and allocation problems. Quite the contrary, health economics is still a growing field with increasingly detailed analysis of specific questions in characteristic financial and legislative environments.

Health technology assessment (HTA), for example, is a tool that tries to combine all available medical, economical, and sociological evidence about the impact of a certain treatment, drug, or medical device. Sickness funds (compulsory insurance), the state, and private insurers alike need to know exactly what the impact of using a certain technology is. In order to answer that, a multidisciplinary approach is needed. Those who coordinate such projects have to be able to speak to medical people, epidemiologists, statisticians, economists, and sociologists as well as administrators and data security personnel and be able to understand their different concepts and principles.

Anyone who is interested in this field should ideally combine a medical or natural sciences background with some other qualification, be it an MBA, a diploma in sociology or in communication, or a master's in public health. What counts from my point of view are intellectual flexibility and analytical rigor. So-called "soft skills" and "emotional intelligence" are important but they do not substitute for a solid knowledge and methodological basis.

Here at IGES we bring people from various fields together in order to achieve the comprehensive overview required by HTA. IGES was founded in 1980, and today it is the largest private research institute in health care and social research in Germany. Some 30 people work here, and the institute's main strength lies in its multidisciplinary approach combined with sound statistical and epidemiological expertise and in-depth knowledge of the German health care system. We do, however, also work in other countries and for supranational organizations such as the World Bank or the European Union.

What I thoroughly enjoy is the vast range of topics that are covered in the different projects and the different kinds of people I meet and deal with. Managers from pharmaceutical companies are quite different from civil servants in hospitals or in the health care administration. With some years of experience in health economics, one has excellent prospects in various kinds of institutions and companies. Rather small, however, are the prospects of becoming rich quick through a patent or start-up company.

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