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HEALTH INSURANCE

KEY POINTS: What you need to know about Switzerland’s health insurance price hikes

After the prices of 2024 Swiss health insurance premiums were released on Tuesday, you may be wondering how the sharp increase will affect you and your family, and what you can do to cut these costs.

Published: 27 September 2023 11:42 CEST
A woman in hospital
Photo by Stephen Andrews on Unsplash

At a press conference on Tuesday afternoon, Health Minister Alain Berset announced the rates for Switzerland’s obligatory health insurance (KVG in German and LaMAl in French and Italian) would go up by 8.7 percent on average in 2024, calling it “the highest increase since 2018″.

In comparison, this year’s premiums rose by 6.6 percent on average.

Why have the premiums soared so much?

There are many reasons for this increase.

As the Federal Office of Public Health (FOPH), which is responsible for setting premiums, explained on Tuesday, “this sharp increase in premiums is due to costs which, since the second half of 2021 and particularly during this year, have increased more than expected”.

Specifically, “the increase in medical consultations, outpatient hospital services, as well as medications and their prices, have caused these high costs”.

Additionally, Berset said the high life expectancy of the population is also a factor in the increase in premiums.

While longevity per se is a good thing, it is also expensive because it means more older people with chronic illnesses requiring costly treatments and drugs, are seeking medical care.

How much more will you have to pay for your insurance next year?
 
FOPH calculated that nationally, the average monthly premium will reach 359.50 francs, which corresponds to an increase of 28.70 francs compared to 2023.

This, however, is a general figure which doesn’t take into account variations such as the amount of co-pay / deductions you chose — which range from 300 francs to 2,500 francs — your age, or your canton of residence (read more about this below).

Based on these general calculations, the average premium for adults will increase by 33.80 francs a month to reach 426.70 francs, while that of young adults will go up by 23.80 francs to reach 300.60 francs.

The average child premium will rise by 8 francs, amounting to 111.80 francs.

Again, these FOPH numbers are just a general indication of increases.

How much more will the insurance cost in your canton?

The 8.7 percent increase is a national average, which means some people will pay more and others less.

As you know, each canton determines its own rates, so what you end up paying will depend on where you live.

Ticino residents will experience the highest rise — 10.5 percent.

Premiums in a number of other cantons will also exceed the 8.7-percent national average — for instance, Zug (10.2), Nidwalden and Thurgau (9.5), Vaud (9,9); Geneva (9,1); and Neuchâtel (9.1). On the other hand, Zurich’s increase will be below the national average — 8.3 percent.

And  Basel-City’s residents, along with Appenzell-Innerrhoden’s, will see the country’s lowest increase: 6.5 percent.

To know exactly how much your health insurance premiums will cost next year you have to wait to receive the official letter from your insurance company which, by law, must reach you before October 31st.

In the meantime, you can calculate your rates on this official government site.

Must you pay the new rates, even if you can’t afford them?

The short answer is yes.

Except for some specific exemptions, the KVG / LaMal is compulsory for all permanent residents, regardless of their nationality. 

If you decide not to comply, you will be breaking the law, with all its dire consequences.

Not paying your premiums is like not paying any of your other bills: if you persist, even after receiving reminders, a legal procedure will be filed against you. If you lose (and the probability of this is very high), then your assets and belongings could be seized.

This, of course, is the worst-case scenario. However, what is more likely to happen is that the canton will purchase a health insurance policy for you and send you the bill. If you refuse to pay it, than the above-mentioned scenario will unfold.

In the meantime, you will not be able to get any health care, except for emergencies.

What if you really can’t afford to pay the new, higher rates?

In that case, help is available.

If the premiums exceed 10 percent of your income, you could be eligible for financial aid — the so-called ‘healthcare subsidies” from your canton.

Before deciding whether you receive the assistance, however, your canton of residence will look not only at your earnings, but at any other financial assets you hold as well.

So if your income is low but you have plenty of money in the bank in the form of savings or other investments, you will not qualify.

Generally speaking, anyone who is a low earner or has a large number of children, could be eligible for subsidised premiums, though criteria, as well as amounts, vary from one canton to another.

READ ALSO: How do I apply for healthcare benefits in Switzerland? 

Is there a way to cut the cost of health insurance premiums?

Fortunately, there is. 

There are different ways to do so, including switching your insurance to another provider, staying within the same company but opting for a cheaper plan, or increasing your co-pay deductible.

This article explains in detail all the different money-saving possibilities that are available to you:

How to save money by changing your Swiss health policy

Keep in mind, however, that any changes to your current policy can be made only once a year.

After you receive a letter from your insurance carrier informing you of the new rates, you will then have to notify it of the switch by November 30th at the latest.

Make sure you have another plan in place before cancelling your current one; the company can’t cancel your policy unless you have proof of being insured elsewhere as of January 1st, 2024.

You may be wondering just about now whether Swiss healthcare is really worth such high premiums; in other words, do you get value for your money?

While the costs of insurance are undeniably very high, maybe you can get some comfort from knowing that the quality of care you get in return is very high.

Unlike countries with public, taxpayer-funded health systems, Switzerland’s population has a good and relatively quick access to medical services, including doctor appointments and referral-free consultations with specialists.

READ ALSO:

If you have questions concerning Swiss health insurance or the new rates, please email us at [email protected]. We will answer them in future articles.

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HEALTH INSURANCE

How Switzerland’s two crucial health insurance referendums could impact you

The price of Swiss health insurance premiums has been rising significantly in the past few years, prompting political parties to launch two cost-cutting initiatives. The votes will take place in June and there's a lot at stake.

Published: 24 April 2024 15:33 CEST
How Switzerland's two crucial health insurance referendums could impact you

On June 9th, the Swiss will cast their votes on two issues aiming, though in different ways, to curb the continually increasing cost of the obligatory health insurance (KVG / LaMal).

This is what’s at stake.

The ’10-percent’ initiative

In view of the high (and rising) premiums and other costs of living, which eat up a big chunk of the budgets of low- and middle-income consumers, the Social Democratic Party has spearheaded a national vote to cap the insurance rates at 10 percent of income.

Anything over this limit should be paid for by the federal and cantonal government, the party says.

While this strategy may sound enticing to everyone tired of paying high premiums, the government warns that while this proposal looks good on paper, the ‘yes’ vote could unleash some serious consequences.

Its main argument is that this measure would cost several billion francs per year, and does not provide any incentives to control health costs.

Instead, the Federal Council and the parliament have concocted their own ‘counter initiative’ that they want voters to approve.

Under this proposal, cantons will have to increase the amount of financial help they pay toward health premiums for low-income people. 

READ ALSO: How do I apply for health insurance benefits in Switzerland?

‘For Lower Premiums’ initiative

For its part, the Centre party has come up with its own proposal to reduce health insurance costs, which will also be voted on June 9th.

It provides for a ‘brake’ on health costs, which should evolve according to the economy and wages.

This brake would work in the same way as the federal spending brake. Therefore, when healthcare costs exceed wages for a given year by 20 percent, the government must take action to bring the  costs down.

The government is asking voters to turn down the Centre’s proposal because it doesn’t take into account factors such as demography, technological progress in healthcare, as well as the dependence of salaries on economic developments.

Here too, the Federal Council and parliament have put out their own counter-project, providing for more targeted measures, including specific cost control objectives for healthcare services.

Are there any other proposals on the table aiming to curb the cost of insurance premiums?

Yes.

While they are not on the ballot, two ideas have been debated in past months.

One calls for scrapping multiple private carriers  in favour of a government-run single health insurance scheme, similar to that in the EU. 

The other idea floating around is to replace the current system where rates are determined by factors such as age and canton of residence, and base them on wages instead. 

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