The Federal Act of 18 March 1994 on Health Insurance (Health Insurance Act, HIA) is based on the principle of solidarity between healthy and sick individuals. When it entered into force at the start of 1996, the HIA completely changed the system of health insurance in Switzerland. Since almost 100 percent of the population already had health insurance, the new requirement for insurance did not lead to an increase in the number of people insured, but the single premium for men and women and for young and elderly people promoted solidarity.
This basic insurance, with a clearly defined, comprehensive list of benefits, is part of the country’s social insurance legislation and has been overseen by the Federal Office of Public Health (FOPH), which is part of the Federal Department of Home Affairs (FDHA), since 2004.
The HIA has been revised a number of times since it came into force. On 21 August 2019, the Federal Council approved the dispatch on the partial revision of the HIA concerning cost-containment measures – Package 1 and submitted it to the Federal Councillors. The dispatch contains nine measures. One of the focal points is the introduction of an Article concerning experimentation, intended to enable innovative and cost-cutting projects outside the “normal” framework of the HIA to be pursued. Other objectives include strengthening the checking of invoices by insurers and insured persons, introducing regulations affecting tariffs and cost control, and introducing a reference price system for off-patent medicines that has been planned for a long time.
According to the HIA, everyone living in Switzerland must have statutory basic health insurance (SHI). An insurer who offers SHI is not permitted to refuse insurance to anyone because of their gender, age or any other reason. The concept of risk equalisation that is firmly established in the HIA seeks to achieve a balance between the differences in the populations of individuals insured by the various insurance providers, since these differences result in different treatment costs and therefore in different insurance premiums as well. It is intended to reduce or eliminate the incentive for health insurance providers to target “good risks”, i.e. people who generate low health costs (primarily young people and young men in particular), thus gaining a competitive advantage over other insurers.
Efficient insurance funds
The HIA provides for statutory health insurance to be offered by health insurance funds. This specifically means non-profit companies. Accordingly, all health insurance funds authorised by the Federal Office of Public Health (FOPH) may offer basic insurance. Competition between the various insurers who offer statutory health insurance is thus regulated. The benefits that must be provided are identical for all insurers and are defined in the Health Insurance Benefits Ordinance. The regulated competition in basic insurance leads to efficiency and lean administration within the insurance providers’ organisations and therefore helps to ensure that premiums are spent efficiently.
In September 2014, the Swiss electorate voted against the initiative “for a public health insurance fund” (single fund) with a 61.9 percent majority, thus rejecting it firmly. More recently, though, there has once again been growing support for a single provider of basic health insurance.