How Swiss manage health insurance?

The Swiss health insurance provides quality services at minium affordable cost to government. In same years, America has not been able to provide minimum insurance to many of its citizens. According to recent statistics provided by Journal Health Affairs, more than 47 million Americans have no health insurance and other 25 million are underinsured. The question is quite evident by now. Despite using best brains in the world and latest technology, why America has not been able to manage health insurance efficiently? There is no simple answer to the question.

In the US, old people are covered by government in Medicare and poor people in Medicaid. Many others take insurance from privare insurers. Rest pay for themselves as we do in India but medical care in America is much costlier. On the contrary, Swiss government mandates everyone to buy a basic policy from private insurance company. Even if a person has serious chronic illness, insurers can't deny coverage and they cannot vary premiums on the basis of pre-existing conditions. Wouldn't it bankrupt insurers? No, they have a simple solution - basic plans. They do not make any any profits on these plans but neither make any losses. If anyone wants to buy additional coverages or has expensive ailments, he or she has to pay higher premiums. The premium on basic plan varies according to age of customer.

True! Not all Swiss are rich enough to pay premiums of even basic plans. For that, government pays the part excess to 8% of income which means people has to pay maximum of 8% of their salary for basic insurance plan. Because government is paying a part, it has to keep prices in control. It does partially by controlling prices of drugs and tests. Furthermore, it also mandates that cost of all medical services be made pubic. That way, it forbids providers to charge unnecessarliy high.

In United States, employers make a big contribution in providing health insurance but the system has an inhernt discrimination against unemployed. The Swiss healthcare system does not requires employers to insure anyone. Every person insures himself (and his family) with just 8% of his income. This also gives freedom to go to patient; he is not tied to any primary care physician or service group unlike in American system. Because insurers and providers have fewer restrictions from government, they make profits. Waiting queues are short and services are excellent. A patient can walk in any hosptial and has to pay a small part of prescribed drugs. The government pays the rest. Insurance companies, like in United States, work with providers to reduce the medical costs. They sign contracts, does utilization reviews and negotiate.

There are many differences in United States and Switzerland and it will not be fair to suggest Swiss helath care system to the needs of Americans. But, Swiss system has been admired a lot by people across the world for its quality services at affordable prices. It may not suit America or every country entirely but it is still a model worth studying.

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The author is IT consultant to a major Health Insurer in America.