Switzerland: A Case Study in Consumer-Driven Health Care

Forbes ^ | 12/29/2012 | Avik Roy

[SeekAndFind]

In 2007, Harvard Business School professor Regina Herzlinger and McGraw-Hill published Who Killed Health Care? America’s $2 Trillion Medical Problem—And The Consumer-Driven Cure. In the book, Herzlinger describes the health care system of Switzerland as a case study in consumer-driven health care, one that has things for both liberals and conservatives to like (and dislike). Given the fact that both Obamacare’s insurance exchanges and Paul Ryan’s Medicare reform proposals borrow from Switzerland’s model, it’s worth learning from Regi’s research on the topic.

Her work has influenced my own thinking about how to use parts of Obamacare to reform Medicare, Medicaid, and the employer-sponsored health care system in the United States. What follows is an edited excerpt from her book and a related 2004 paper from the Journal of the American Medical Association, reprinted with permission from the author.

Switzerland has achieved private-sector universal coverage

Switzerland, the only developed country with a long-standing consumer-driven health care system, provides broad evidence and important lessons about its efficacy. Unlike the U.S. system, in which employers or governments select health insurance, in Switzerland, it is the consumers themselves who purchase their health insurance. The Swiss have considerable experience with some of the consumer-driven insurance policies newly introduced in the United States, such as those with high deductibles.

Switzerland has been politically neutral since at least 1907, unlike most of its European neighbors. It is a haven of quiet in a roiling sea. Its consumer-driven health care system mirrors the country’s traditional independence, as citizens may freely choose plans, and its solidarity, as it requires everyone to purchase health insurance and subsidizes the needy. But it more closely mirrors its neighbors’ centrally controlled health care systems in the constraints placed on insurers and providers.

[SeekAndFind]

[Kansas58]

Thanks for posting, ping

[beef]

Things work in Switzerland because the Swiss cultivate a high sense of personal responsibility. Unfortunatly, the US does not have this anymore.

[An.American.Expatriate]

Oh yeah, we have a great system here in Switzerland ...
we are required to purchase insurance,
the basic insurance costs more or less the same regardless of where we get it, but
we are “free” to choose the provider.

3 years ago I switched to the cheapest possible alternative and it cost $500 for a family of 5 (roughly 10% of the average Swiss income). The rates for 2013 are in - I now pay $800 for a family of 4 - incomes have not risen much more than inflation over that period (~2%/year).

Of course, I still have to pay the first $1500/year/person in medical costs and extras like Glasses and such are only covered on a limited basis. Once my $1500 is paid, the insurance kicks in and covers ~90% - needless to say, $1500 in bills for one person in a given year is a lot. But if I lower the deductible, my rates rise quickly.

A lot of people discovered that the high deductible was worth it based on the amount saved / year - so the government decided to penalize us for not being “social” and raised our rates at a higher percentage that then other categories.

Yep, great system.

[LibertyOh]

I lived in Zurich 2008/09 and left my fairly good health insurance with a large US company to find I would be paying slightly more to buy my own unsubsidized insurance in Switzerland. Our daughter had to have a minor operation, done in the Dr’s office, at a cost much less than it would have been in the US. After coming back to the US and having to find personal health insurance, I can assure you that your current circumstance is much better than it would be in the US. We are now paying about twice the Swiss insurance rate, have a family deductible much higher than the Swiss insurance. Bad as it may seem, the limited malpractice insurance costs (direct and indirect through layers of testing etc....) in Switzerland makes for a pretty good system. Check out what you can get in the US - you’ll be glad you’re still there.

[SunkenCiv]

Note: this topic is from 12/29/2012. Thanks SeekAndFind.