Switzerland
Health Insurance Act |
Enacted1994.Number of People CoveredEvery person living in Switzerland.Estimated Cost12% of GDP.
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Plan in Brief
- The government defines compulsory coverage: illness, accident, hospitalization, nursing home care, prescription drugs, diagnostics. Private insurance plans sell packages directly to individuals.
- The Swiss approach thus features consumer-driven health care, government oversight, and multiple players.
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Impact on Federal Government
- The federal government defines and regulates coverage.
- The federal government contributes 24.9% of health care funding compared with the 44.7% paid by the U.S. government.
- Subsidizes coverage for the poor.
Organization
- The federal government defines compulsory coverage and oversees approval and coverage of drugs, devices, and technologies. Prices are negotiated between insurers and cantons. Individuals pay for coverage and can purchase supplemental insurance beyond the mandated compulsory level.
Impact on States
- Switzerland’s cantons separately negotiate prices with insurers and providers.
Impact on Insurers
- The Swiss system relies on private insurers, all of which must offer the same basic benefits package.
- Individuals can purchase coverage beyond the basic compulsory package.
Impact on Providers
- Payments to providers are determined by negotiations between insurers and government.
- Individuals have a choice of providers.
- Regulation of nonphysician providers is markedly strict, so patients frequently turn to physicians rather than theoretically less expensive providers.
Impact on Employer
- Employers are not required to provide coverage for employees. Consequently, few employers do.
Impact on Individuals
- With some exceptions, everyone must obtain insurance within three months of arrival in Switzerland or birth.
- Individuals purchase insurance directly; each family member must have his or her own insurance.
- Government subsidies are available for lower income individuals.
- Premiums are based on age, not health status.
- Avoiding the individual mandate is punishable by fines and/or prison sentences.
| Proponents/Opponents
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| The Swiss system is admired for having achieved universal coverage at a relatively low cost (cost as a share of GDP is second to that in the United States, but a greater proportion of the populace has coverage). The quality of care is considered high, and guaranteed issue means that the sick aren’t penalized by higher cost or denial of coverage. |
Critics say that the Swiss system is not really a model of consumer-driven health care because of the high level of government control. The government’s requirements for compulsory packages put a limit on low cost options and leave consumers with few choices and high deductibles. Likewise, the government’s control over pharmaceutical approval and procedure reimbursement limits choice. It also hobbles innovation.
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Key Targets for Investment
- Coverage beyond the compulsory levels.
Notable Feature
- Mitt Romney’s plan for health reform in Massachusetts was based in part on the Swiss approach.
- The Clinton managed health care proposal in the early 1990s was similar to the Swiss system.
- Switzerland is second to the United States in terms of share of GDP devoted to health care, but government spending is substantially lower.
- The level of compliance with the individual mandate might reflect cultural values and might not be replicated in other countries.
- More than 70% of Swiss citizens recently voted against a single-payer system.
Experts' Comments
“People in Switzerland realize what [health care] costs do to American business, and they don't want to add to the anti-competitive burden of Swiss businesses in the global economy…. [Swiss citizens] do not want employers to get so much into their private life and lifestyle.”
-- Felix Gutzwiller,
Zurich Institute for Social and Preventive Medicine,
Quoted in the Dallas Morning News, February 2006
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For Further Information
Switzerland’s Federal Office of Public Health: Focus on Insurance
Looking at Dutch and Swiss Health Systems
Comparison shopping for health care in Switzerland
Health Care Around the World: Switzerland
Foreign Health Affairs: Opinion
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