Swiss people fund around a third of all the country's healthcare costs though a compulsory insurance system and the cost of this obligatory insurance has shot up twice as fast as GDP and wages since 1996.
To ease the financial strain on households, Vaud is now introducing a cap on health insurance. As of September 1st, this cap will be set at 12 percent of household income with anyone paying more than this entitled to a government subsidy. From January 1st this cap will be reduced to 10 percent.
Outlining the new scheme, the canton provided the example of a family with two children, an annual household income of 90,000 francs and a health insurance bill of 1,080 francs a month (or 14.4 percent of income).
The above family would receive a subsidy of 180 francs from September 1st. This subsidy would then rise to 330 francs at the beginning of next year.
Thousands of people are expected to benefit from the changes.
Around 36 to 39 percent of health insurance holders in Vaud are set to receive subsidies in 2019, the canton said in a statement. In 2017, that figure was 29.9 percent.
The cost of the move is forecast to be between 50 and 60 million Swiss francs a year for the canton. This is higher than original estimate.
But the head of the Department of Health and Social Services in Vaud, Socialist politician Pierre-Yves Maillard, has achieved his political goal of providing financial relief to residents of the canton in general and the middle class in particular, Swiss news agency SDA reported.
Developments in Vaud are likely to be closely watched around the country. In the canton of Geneva, left-wing politicians have already called for a similar move while at the federal level, the centre-right Christian Democratic Party (CVP) has called for the brake to be applied on soaring premiums. These are expected to rise again in 2019, Swiss comparison website Comparis said in a report published in June.
People eligible for the new subsidy in Vaud, or who feel they may be eligible, need to apply. This can be done online (in French) or by visiting offices of the cantonal health and social services department (DSAS).