How Swiss healthcare costs have ‘doubled’ since 2000

Recently released figures show that health insurance premiums have doubled in the past 20 years, with some Swiss households spending almost one fifth of their salary on healthcare.

Published: 9 December 2019 11:31 CET

How Swiss healthcare costs have 'doubled' since 2000

Photo: Depositphotos

Figures from the Swiss Trade Union show that costs have increased by 120 percent on average since the year 2000.

The increases are much higher than wages, while other cost-mitigating changes like rebates for people on lower incomes have also failed to keep up with rising premiums.

Couples with household salaries between 60,000 and 90,000 francs spend on average 14 percent of their salaries on healthcare.

In some of the more expensive cantons such as Bern and Zurich, the amount can be higher than 20 percent.

While lower income Swiss will be eligible for reductions and rebates, middle-income Swiss are often hit the hardest by increases in healthcare costs.

More going into debt to pay for healthcare

The impact of the cost increases can be seen in relation to household debt for healthcare.

At the turn of the millennium, just over a third (36 percent) of households in Switzerland had healthcare debts higher than 5000 francs.

At the present time, 59 percent of households had accrued debts of over 10,000 francs for healthcare costs.

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The onset of winter will raise concerns for many in Germany about the cost of heating their homes, with memories of last year’s rocketing prices and concerns over domestic gas supply resurfacing.

But, compared to last year, the energy prices have now largely stabilised, though they are still higher than in 2021.

The stabilisation in prices is partly thanks to the government’s energy price cap which came into force earlier this year to cushion the blow of soaring energy prices by capping electricity costs at 40 cents per kilowatt-hour and natural gas at 12 cents.

The federal government plans to maintain this cap until the end of April, though this could be extended even longer, if necessary.

How high are heating costs expected to go this year?

For the current year, experts from co2online expect somewhat lower heating costs than last year.

Heating with gas, for example, is expected to be 11 percent cheaper in 2023 than in 2022, costing €1,310 per year for a flat of 70 square metres.

The cost of heating with wood pellets will drop by 17 percent to €870 per year, and heating with heating oil will cost 19 percent less and amount to €1,130.

According to co2online, the costs for heating with a heat pump will drop the most – by 20 percent to €1,1105. The reason for this, according to co2online, is a wider range of heat pump electricity tariffs.

Tax hikes in January

Starting January next year, the government will raise the value-added tax on natural gas from seven to nineteen percent.

Alongside this, the CO2 price, applicable when refuelling and heating, will also increase.

According to energy expert Thomas Engelke from the Federal Consumer Association, these increases will mean that a small single-family household with three or four people that heats with gas would then pay about €240 more per year for gas.

“That’s a lot”, he said.

Another additional cost factor to consider is that network operators also want to raise prices. However, the federal government plans to allocate €5.5 billion to cushion this increase for consumers as much as possible, so how such cost increases will ultimately affect consumers is currently hard to estimate.

Overall, it can be said that, from January, consumers will have to brace themselves for higher energy costs, even though massive increases are currently not expected.

Consumer advocate Engelke advised customers to closely examine where potential savings could be made this upcoming winter: “Those who are now signing a new gas or electricity contract should inform themselves and possibly switch. Currently, you can save a few hundred euros. It’s worth it. On the other hand, you should also try to save as much energy as possible this winter.”