Switzerland: a health care system up for debate

André Forissier, translated by Gemma Kentish
29 Janvier 2015

On 28th September 2014, Swiss citizens voted on the proposal to introduce a unified state health insurance. While the French speaking Swiss voted in favour of the proposal, it was rejected by the German speaking part of the nation. But this referendum, typical of the discussions on health care in this small country in the Alps, has revived an age-old debate.

Credit DR
Credit DR
Concordia, Helsand, Sanitas, Vaudoise… Just a few of the sixty-something private health insurances currently available in the Swiss Confederation. Submitted by the Swiss Socialist Party (PSS) on the 28th September 2014 and rejected at the Federal level, the initiative proposed a simplification of the current system with the creation of a unified state health insurance. 

High quality care

So why did more than 100,000 Swiss citizens decide, between the 1st February 2011 and the 23rd May 2012, to call for the creation of a unified state health insurance?

Swiss health care is certainly of an exceptional quality. For example, the Swiss enjoy the second highest life expectancy in the world, the figure reaching approximately 85 years for Swiss women and 80.7 years for men. And this small nation is even ranked as the third happiest country in the world, according to a report carried out by the United Nations in 2013. All this seems enough to draw you to come and settle down in Switzerland and live out the rest of your days in the invigorating mountain air in the village of Zermatt (in the Valais region in the southwest), or among the terraced grapevines along the tranquil Lake Geneva. 

Furthermore, Swiss medical equipment boasts cutting-edge technology, and has a large number of hospitals. There are as such 298 for 8 million inhabitants. Even better, Switzerland has some of the world leading pharmaceutical and health companies: Roche and Novartis are two companies originating from Basel, the country’s third principle city situated in the Northwest.

And yet, the world rankings for this multilingual country is plummeting with regards to its quality of health care, according to reports carried out by the World Health Organisation (WHO). This Alpine nation is dragging behind in 20th place, while France, as much as she has been criticised, has been ranked number one. 

An exorbitant price for health care

This world ranking does not take into account just the quality of health care. In addition, the report looks into financial access. And looking at Switzerland, where the cost of living is very high - Zurich being the most expensive city in the world for an expat to live according to the firm Mercer - health care is exorbitantly priced.

Fiona, a 26 year-old student living in the Canton of Fribourg, explains: “Up until I was 25 years old, I was paying 290 francs a month (approximately €240). So each year, I was paying almost 3,500 francs (approximately €2900). But I was a student and my family didn’t help me financially”. However, she adds: “Now I am more than 25 years old and I am categorised as someone who earns too little. I now spend only 62 francs a month (roughly €51). And I spend around 750 francs yearly (almost €615).”

This sum paid each month is known as a premium. But regardless of the amount, it is still overpriced. Fiona explains; “I thus pay 1500 francs in excess (approximately €1250). The health insurance refuses to reimburse anything below this figure. And that’s what is so unfair, since the wealthy can go  to the doctors more often.”

It is in opposition to these high premiums that more than 100,000 Swiss citizens, between the 1st February 2011 and the 23rd May 2012, have shown their support for the creation of a unified state health insurance.

Switzerland employs a semi-direct system of democracy. This means that the people elect their representatives, but they also have the ability to call for public votes, where they can give their opinion and decide their future themselves. These elections are constraining, since Parliamentarians and others in power are obliged to take the results into account.

A positive vote requires a change in the Constitution. Thus, the 28th September 2014 referendum proposed a modification to Article 117 of the Federal Constitution, which rules on the issue of health and accident insurance, calling for the following additional sentence to be written in: “health assurance is managed by a unified national institution under public law.”

Proof that the current health system can spark lively discussions, the referendum in September was the fourth vote organised on the subject since 1994. Twenty years ago it was the PSS, under the principle of a “healthy health insurance”, that fought to fix premiums in accordance with the financial resources of clients. In 2003, again it was the PSS who was behind the “affordable health” initiative, and called again for premiums to be dependent on income, wealth and the number of dependents. Finally, the vote organised on the 11th March 2007 proposed a “single social health insurance” where premiums would be based on the “financial capabilities of clients”. Each time, the Swiss people voted overwhelmingly against these reforms.

The supporters of the ‘Yes’ vote in 2014, like Fiona, have also criticised the huge sums of money spent by private insurance companies on advertising to attract new customers. The young Swiss student highlights that “they pay a fortune for this form of communication, and this is the money not given in pay outs”. Pierre-Yves Maillard, PSS member and Councillor of State for the Vaud Canton (Lausanne region), remarks that they cost at least 350 million francs (€290 million) each year…

Those in favour of the health care system reform, such as Valaisan Socialist Stéphane Rossini, also stresses the illegibility. Almost 300,000 premiums exist today in Switzerland, and the prices can vary from a simple price to double, depending on the Canton.

Finally, Mathieu Fleury, President of the Romande Consumer Federation (FRC) condemns “competition that doesn’t work. Insurance policies discourage patients with serious illnesses”. Only the principle insurance is obligatory. Complementary insurance is optional. Some might say that private insurance companies only propose complementary insurance to those in good health. Pierre-Yves Maillard highlights that 70% of payouts from Helsand and their rivals go to just 10% of their clients. Fiona confirms this; “Someone who has cancer or another serious illness is often rejected by a new health insurance. This person cannot change and thus has to stay with their current insurance. They have no choice but to accept the conditions of their insurer, which can change every year”.

 As for the sworn opposers of the initiative, like the Swiss People’s Party (UDC) or the Free Democratic Party of Switzerland (PLR, centre), they praise the benefits of competition and the economic market, which offers 61 possible insurers, which are, according to them, offer the best service possible.

They also believe that such a reform would lead to a large wave of nationalisation and open the door for a Socialist form of economics. The creation of a single public health insurance would cause long waits for repayments and would bring about economic unease to the small prosperous Swiss haven, in a context of surrounding European crisis. Its introduction would cost at least 2 billion francs (€1.65 billion) and would pose a threat to public finance. In 2014, Swiss public debt only increased to 35.4 of Gross Domestic Product (GDP). Giving in to a new health care system would place Switzerland among her indebted neighbours like Austria (with public debt at 74.5% of GDP), Germany (76.9%), France (92.2%), and Italy (132.6%).

On the evening of the 28th September 2014 after an intense campaign, 61.8% of the Swiss population, 16 Cantons and 6 half Cantons rejected the PSS-led initiative.

French Switzerland versus german Switzerland: the Röstigraben phenomenon

Although Switzerland rejected the initiative at national level, certain particularities do emerge when looking at local results. Voters from 3 central Cantons, Ur, Nidwals and Schwyz, which were unified in 1291 to create the Confederation, each voted against the reform with more than 66% of the vote. The very rural Canton of Appenzell Rhodes-Intérierures (Northeast) gave a loud ‘no’ with 81.7%. These Cantons, all German speaking, provide us with an image of what was happening across the other German speaking Cantons, all of which rejected the single public health insurance. Only citizens from Basel saved the ‘yes’ vote from a German Swiss humiliation, giving 45% of their vote in favour of the text.

As for the four Cantons which did vote for the PSS initiative, all are located within the Swiss Romande (West), French speaking Switzerland. The Jura, along with the Cantons of Geneva, Neuchâtel et Vaud voted 57.3% in favour of the public health insurance proposal. As for bilingual Cantons such as Fribourg and Valais, the ‘yes’ vote obtained 49.7% and 33% of the vote respectively. And again, the disparities became apparent there. In the Canton of Fribourg, the French speaking communities voted 54% in favour, whereas 65% of the German speaking communities voted ‘no’, tipping the overall vote against the reform. Only the Romande Canton of Valais, of which 70% are French speaking, did not want a reform of health care insurance, 67% declaring ‘no’.

Yet again the Röstigraben (A cultural barrier between the two languages in Switzerland) has reared its head. The word rösti is actually a culinary specialty originating from German Switzerland, and is now exported across the world; Mac Donald’s even offering rösti fries to adapt to its Swiss customers. The humorous expression is supposed to demonstrate the political differences between the Francophones and Germanophones. In 2009, the Röstigraben was evident in the famous vote on minarets. At the Federal level, four Cantons had refused the prohibition of these architectural elements. Three of them were French speaking (Geneva, Neuchâtel and Vaud), while all of the German speaking Cantons, with the exception of Basel, voted to prevent the construction of minarets. It is fair to say that the Swiss Romande tend to vote more on the left than the rest of the country.

With regards to the September 2014 vote, a number of analysts argue that it is not only a cultural difference that can explain the discrepancy in results. Premiums are in fact lower in the German speaking Cantons than in the French.
In any case, following the results, Pierr-Yves Maillard proposed the creation of a unified public Romande insurance, or Cantonal public insurances. The PLR has shown its opposition to such a project, criticising the notion of a democracy ‘à-la-carte’.
The debate on the Swiss health care system is far from over.