How to fix Switzerland’s costly healthcare system

In Switzerland, drug prices make a significant contribution to healthcare costs. Christian Beutler / Keystone

Swiss voters have rejected the proposals put forward by the Social Democratic and Centre parties to curb rising health costs and ease the financial burden on households. A solution will nonetheless have to be found, experts say. What could that look like?

Both the left and the right of the political spectrum agree that the Swiss healthcare system needs reform. Yet neither the Social Democratic Party nor the Centre managed to win over voters with their popular initiatives.

The Social Democrats proposed placing a cap on health insurance premiums, so that no one would pay more than 10% of their disposable income. But the spectre of tax hikes to finance the extra subsidies loomed over the campaign, turning many voters against the initiative. As for the Centre’s initiative to rein in healthcare spending, it appears to have been too vague to appeal to the public.

So, no solution has been found. In the coming years, healthcare costs will continue to rise, putting strain on the finances of low-income households.

This will keep healthcare on the political agenda for the foreseeable future.

“It will be years before any changes are implemented, but we have to take action now. We don’t have a choice. People are no longer satisfied with the system,” says Stéfanie Monod, a physician and professor at the University of Lausanne and expert on the Swiss healthcare system.

But what could be some possible solutions?

Better distribution of responsibilities

“We are likely to see a proliferation of initiatives to address healthcare costs,” Monod predicts. However, she fears that the problem will be dealt with in a piecemeal fashion when what is really needed is far-reaching reform.

The federal system, she believes, is outdated. “Today, the cantons oversee healthcare. Certain aspects are, however, decided at the federal level. This includes the health insurance system, which determines much of the funding,” explains Monod. “This means that a small canton like Appenzell Inner Rhodes has the same responsibilities over healthcare as a country like France.”

Monod calls for a better distribution of responsibilities. “The federal government should have more say over healthcare.” For example, hospital sector planning and the training of healthcare professionals should be coordinated at the national level. However, “primary care and the coordination of care should be left to the cantons.”

Targeting subsidies and spending

Jérôme Cosandey has a different view. The director of the liberal think-tank Avenir Suisse in French-speaking Switzerland thinks that federalism is a source of strength for the healthcare system. “I lived in Mumbai, a city of over 20 million people. When I moved back to Switzerland, I thought it was an incredible luxury to have 26 health laws in 26 cantons,” says Cosandey. “But then I realised that this makes it easier to meet the needs of the population.”

He cited the example of the subsidies granted to households that can’t afford to pay health insurance premiums. “In the German-speaking cantons, the premiums are generally lower than in the French-speaking part of Switzerland, so there is less need for subsidies,” says Cosandey. “The federal system means that support for low-income households can be better targeted.”

+ Is there an answer to Switzerland’s spiralling healthcare costs?

To reduce costs, Cosandey would like to see greater transparency on the quality of services. This makes it possible to focus on services that bring the greatest value.

He, however, rejects proposals for reducing compulsory health insurance coverage. “It is not so much the catalogue of services that poses a problem as its application. A hip operation should be covered by insurance, this seems obvious; but is it really appropriate for a patient at the end of his or her life?”

Increasing efficiency

Health economist Joachim Marti argues that rising healthcare costs are justified to some extent as they reflect societal priorities. “People want to be healthier; they have higher expectations, and the population is ageing. This will increase needs in the future.”

Other expenses are less justified and stem more from inefficiency, Marti says. “These are the costs that should be cut. And here, the Holy Grail is finding ways to slow growth in spending without affecting the quality of care.” 

Marti suggests some concrete measures. “One approach would be to improve prevention, an area where Switzerland invests less than other countries.” He also suggests better coordination of care, tighter control over drug prices and avoiding treatments with low added value.

Edited by Samuel Jaberg. Adapted from French by Julia Bassam/jdp.