EXPLAINED: Why Swiss healthcare costs are rising and how you can save
After premiums on Switzerland’s compulsory health insurance fell last year, new increases are expected in 2023. There are, however, some ways to cut your costs.
Swiss health insurance organisation Santésuisse has recently warned of a “worrying” increase in 2023 of the already expensive health insurance premiums.
They could go up as much as 10 percent over the current rates — the sharpest hike in premiums in 20 years.
READ MORE: ‘Worrying’: Swiss health insurers warn of significant price increases
The reason are higher medical costs incurred during the two years of coronavirus pandemic, estimated to cost insurers one billion francs so far, not even taking into account about 265 million spent for Covid vaccinations in 2021.
Santésuisse and MPs are now calling for measures to stop costs from soaring further.
"If you do nothing, there is a risk of double-digit premium increases", Santésuisse’s director Verena Nold said in an interview on Friday.
On the political front, the initiative launched by the Centre / Mitte party demands that the Federal Council and the cantons intervene if healthcare costs rise sharply in relation to wages.
A similar initiative by the Social Democratic party wants a ruling that no household has to spend more than 10 percent of its disposable income on premiums.
Santésuisse is also urging the government to implement a range of reforms to reduce costs and ensure that not so many are passed on to consumers.
One is to establish a system which rewards efficiency and cost-effectiveness in service delivery, encouraging doctors, hospitals and pharmacies to be more expedient.
“We could also, for example, lower the laboratory prices, as we pay up to three times as much as abroad”, Nold said, adding that a reduction in drug prices to European levels is also an option.
"With regular comparisons of drug prices and an adjustment to the price level in European comparison countries, taking into account all discounts, a large savings potential could be exploited”, Santésuisse said.
While the insurance industry and politicians are debating cost-cutting measures, what steps can individuals take to lower their healthcare premiums?
As outlined in our article from November 2020, there are several ways to lower the cost of premiums, even if slightly:
Health maintenance organisation (HMO)
Under this model, policyholders are required to consult a particular HMO practice. Two disadvantages of this alternative is a limited choice of doctors and you also need a referral to see a specialist.
However, the benefit is a premium reduction of up to 25 percent compared to the conventional insurance.
Family doctor model
Your family doctor, a general practitioner, will be designated by your insurance company and will be in charge of all your medical treatment.
He or she will refer you to a specialist if necessary.
If you opt for this option, you could save 20 percent on your insurance.
READ MORE: Five tips for getting cheaper health insurance in Switzerland
The Telmed alternative
If you choose this option, you have to call a telephone service and get a referral to a doctor or hospital.
This does not apply to medical emergencies and other exceptions, such as eye exams and annual gynaecological check-ups.
Total savings could range between 15 and 20 percent.
For both HMO and Telmed you can calculate your premiums here.
Increase your deductible
In Switzerland, the deductible (franchise) ranges from 300 to 2,500 francs.
The lower your deductible, the higher your premiums, and vice-versa.
If you are young, healthy, hardly ever get ill, and don’t take any expensive medications, then you can save substantially with the highest franchise.
Keep in mind, however, that if you choose the highest deductible and end up needing medical care, you will have to pay a greater proportion of the costs.
Pay the premiums in one lump sum
Most insurance carriers will give you a 2-percent reduction if you pay your premiums upfront rather than on monthly basis.
If you want to want to cancel your current insurance and switch to a cheaper one — your carrier must notify you of the new rates by October 31st — you have to do so by registered letter before November 30th.
READ MORE: EXPLAINED: How to change your health insurance carrier in Switzerland and save money
What if you want to really save on premiums and don’t take out an insurance policy at all?
Nice try, but no.
Even if you are healthy, you still need to have basic health coverage, called KVG in German and LaMal in French and Italian .
If you don’t purchase a policy within three months of your arrival in Switzerland, authorities will send you a letter reminding you of your obligation to do so.
If you still refuse, your canton will purchase insurance for you and send you a bill — which you will have to pay.
Also, several cantons — Aargau, Lucerne, Ticino, Thurgau, and Zug — keep blacklists of people who don’t pay their health insurance premiums. The delinquent payers can be treated for emergencies, but the insurance will not cover their other medical bills.
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Swiss health insurance organisation Santésuisse has recently warned of a “worrying” increase in 2023 of the already expensive health insurance premiums.
They could go up as much as 10 percent over the current rates — the sharpest hike in premiums in 20 years.
READ MORE: ‘Worrying’: Swiss health insurers warn of significant price increases
The reason are higher medical costs incurred during the two years of coronavirus pandemic, estimated to cost insurers one billion francs so far, not even taking into account about 265 million spent for Covid vaccinations in 2021.
Santésuisse and MPs are now calling for measures to stop costs from soaring further.
"If you do nothing, there is a risk of double-digit premium increases", Santésuisse’s director Verena Nold said in an interview on Friday.
On the political front, the initiative launched by the Centre / Mitte party demands that the Federal Council and the cantons intervene if healthcare costs rise sharply in relation to wages.
A similar initiative by the Social Democratic party wants a ruling that no household has to spend more than 10 percent of its disposable income on premiums.
Santésuisse is also urging the government to implement a range of reforms to reduce costs and ensure that not so many are passed on to consumers.
One is to establish a system which rewards efficiency and cost-effectiveness in service delivery, encouraging doctors, hospitals and pharmacies to be more expedient.
“We could also, for example, lower the laboratory prices, as we pay up to three times as much as abroad”, Nold said, adding that a reduction in drug prices to European levels is also an option.
"With regular comparisons of drug prices and an adjustment to the price level in European comparison countries, taking into account all discounts, a large savings potential could be exploited”, Santésuisse said.
While the insurance industry and politicians are debating cost-cutting measures, what steps can individuals take to lower their healthcare premiums?
As outlined in our article from November 2020, there are several ways to lower the cost of premiums, even if slightly:
Health maintenance organisation (HMO)
Under this model, policyholders are required to consult a particular HMO practice. Two disadvantages of this alternative is a limited choice of doctors and you also need a referral to see a specialist.
However, the benefit is a premium reduction of up to 25 percent compared to the conventional insurance.
Family doctor model
Your family doctor, a general practitioner, will be designated by your insurance company and will be in charge of all your medical treatment.
He or she will refer you to a specialist if necessary.
If you opt for this option, you could save 20 percent on your insurance.
READ MORE: Five tips for getting cheaper health insurance in Switzerland
The Telmed alternative
If you choose this option, you have to call a telephone service and get a referral to a doctor or hospital.
This does not apply to medical emergencies and other exceptions, such as eye exams and annual gynaecological check-ups.
Total savings could range between 15 and 20 percent.
For both HMO and Telmed you can calculate your premiums here.
Increase your deductible
In Switzerland, the deductible (franchise) ranges from 300 to 2,500 francs.
The lower your deductible, the higher your premiums, and vice-versa.
If you are young, healthy, hardly ever get ill, and don’t take any expensive medications, then you can save substantially with the highest franchise.
Keep in mind, however, that if you choose the highest deductible and end up needing medical care, you will have to pay a greater proportion of the costs.
Pay the premiums in one lump sum
Most insurance carriers will give you a 2-percent reduction if you pay your premiums upfront rather than on monthly basis.
If you want to want to cancel your current insurance and switch to a cheaper one — your carrier must notify you of the new rates by October 31st — you have to do so by registered letter before November 30th.
READ MORE: EXPLAINED: How to change your health insurance carrier in Switzerland and save money
What if you want to really save on premiums and don’t take out an insurance policy at all?
Nice try, but no.
Even if you are healthy, you still need to have basic health coverage, called KVG in German and LaMal in French and Italian .
If you don’t purchase a policy within three months of your arrival in Switzerland, authorities will send you a letter reminding you of your obligation to do so.
If you still refuse, your canton will purchase insurance for you and send you a bill — which you will have to pay.
Also, several cantons — Aargau, Lucerne, Ticino, Thurgau, and Zug — keep blacklists of people who don’t pay their health insurance premiums. The delinquent payers can be treated for emergencies, but the insurance will not cover their other medical bills.
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