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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 political parties want to curb surge in health costs

As voters in Switzerland are set to weigh in on two initiatives seeking to lower insurance premiums, the country’s politicians are proposing their own cost-cutting measures.

Published: 3 May 2024 13:02 CEST
How Switzerland's political parties want to curb surge in health costs

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).

One calls for capping the insurance rates at 10 percent of income, while the other provides for a ‘brake’ on health costs, which should evolve according to the economy and wages.

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

Each initiative has its supporters and opponents, but regardless of what happens on June 9th, the issue of health insurance premiums, and health costs in general, will remain the focus of many political debates.

But while everyone in Switzerland agrees that health insurance is too expensive for most people, opinions on how to make it more affordable  differ along the political lines.

These are some of the main views, as reported by Swiss media.

Social Democrats 

The party that has spearheaded the ’10-percent of income’ initiative to be voted on June 9th, is also calling for scrapping of multiple private carriers  in favour of a single, government-run health fund.

The party argues that such a system would help keep the costs low.

Others, however, disagree, saying that lack of competition would have just the opposite effect: instead of reducing costs, it would increase them further.

They also point out that a private insurance system offers more choices  and provides a higher quality of services — including better access to specialists and shorter wait times for medical procedures —  than a public option.

READ ALSO: Could Switzerland ever change to state-run health insurance scheme? 

The Greens

The party has also spoken in favour of a single health provider, in addition to premiums based on income and wealth.

While the idea has gained support in some circles, others, including the Federal Council, have pointed out that the current system is “already income-based,” because low-earners are eligible for government subsidies if health insurance premiums exceed 8 percent of their revenue. 

The Greens also consider the fight against global warming as a health policy, saying that in Switzerland alone, more than 2,000 people die each year from diseases caused by air pollution.

Liberal-Radicals (PLR)

The party supports the system where patients voluntarily choose generic rather than brand-name drugs in return for lower health insurance premiums.

Under the current scheme, those who choose generics are only responsible for a 10-percent co-pay, while it is 40 percent for brand medicines. 

But “if policyholders can actually choose the model they want, we can definitely consider [this option],” said health economist Willy Oggier.

Swiss People’s Party (SVP)

Perhaps the most radical proposal comes from the party that is most right-wing.

Its proposal: the compulsory health insurance must be abolished altogether.

Not only is this idea drastic, but it is not implementable under the current law.

That’s because the current legislation is the outcome of the 1994 referendum, when voters accepted a general obligation for health insurance.

To repeal it, another referendum would have to be held, with the majority voting to scrap this law.

But even if the compulsory insurance were to be abolished, people would have to pay even more for health care, Oggier said.
 

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