A new survey warns that health insurance premiums could double by 2030, making them unaffordable for many Swiss citizens.
The Swiss healthcare system is known for its excellent level of care, but is also among the most expensive in the world. Switzerland spends 11% of its gross domestic product (GDP) on healthcare, behind the US (17%), Netherlands, France, Germany and Canada.
According to a report by EY Switzerlandexternal link published on Tuesday, healthcare costs have more than doubled in the past 25 years, and look set to rise by 60% to CHF116 billion ($117 billion) by 2030.
This was due to a combination of factors such as inefficiencies – for which the industry itself is to blame – and external developments like medical progress, the increase in chronic diseases and the ageing of the population.
The EY study said the steep rise in costs will hit households hard. It says basic monthly insurance premiums could rise from an average of CHF396 per person to over CHF800 in 2030.
While 6% of monthly household income was spent on health insurance in 2014, this could rise to 11% by 2030, reducing purchasing power significantly, EY Switzerland said.
“This massive cost increase significantly reduces the purchasing power of private households. It means a large part of the population can no longer afford compulsory health insurance premiums. And very few people will be able to afford supplementary insurance,” said Yamin Gröninger, Head of Insurance Business Development at EY Switzerland and co-author of the study.
In Switzerland, health insurance covers the costs of medical treatment and hospitalisation of the insured person. But they pay part of the cost of treatment. This is done via an annual deductible ranging from CHF300 to CHF2,500 for an adult as chosen by the insured person, and a charge of 10% of the cost above the excess up to CHF700 per year. Per-capita out-of-pocket payments in Switzerland are therefore high: 60% more than in the US and almost three times as high as the Organisation for Economic Co-operation and Development (OECD) average.
Gröninger warned that unless drastic countermeasures are taken, a “financial collapse of the basic insurance system in the medium term cannot be ruled out.”
“Further government intervention is on the cards, and even a revival of the debate over unified health insurance,” he said. The Swiss authorities and health officials have been working hard to find ways to fight costs.
The survey authors said it was in the interest of health insurance companies to help improve efficiency in the healthcare system – and not just by reducing their operating costs. They said this could also be achieved via the intelligent use of health data, which can be used as a basis for radically improving the prevention, early detection and treatment of diseases.