ESTADÍSTICAS DESCRIPTIVAS DE LA POBLACIÓN ESTUDIADA

3.1.3.1

The Swiss Health Insurance System

Switzerland underwent a statutory health insurance reform similar to the one in Germany.78 Since 1996 the insured have a choice among all compulsory insurance providers.79 The Swiss have two open enrollment periods per year80 and every resident of Switzerland in forced to enroll for compulsory insurance. The insurers are forced to accept any applicant regardless of health risk. The insurers are non-profit organizations of various juridical or institutional forms. They operate either locally, on the canton (or across several canton) level or nationwide.

The insurers set a flat community rated premium for children, young adults and older adults. Unlike in the German system, in Switzerland every family member has to be insured individually. Each insurer offers five plans that differ only with respect to the deductible. The limits are equal for all insurers (230 Sfr, 400 Sfr, 600 Sfr, 1200 Sfr and 1500 Sfr) and thereafter everyone has a co-payment of 10% for any health care costs of up to 6000 Sfr

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For a comprehensive overview see European Observatory (2000-2), Colombo (2001) and Gerlinger (2003). A good description of the historic origins is provided by Theurl (1999)

79 _{There were 109 insurance providers in 1999, down from 148 in 1996. About 60 to 70% of the funds are very}

small, insuring under 10000 persons. Colombo (2001)

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beyond the deductible.81 Furthermore some insurance companies offer “bonus insurance” contracts, which lead to reduced future premiums if the insured does not incur health care costs. Other insurance providers offer those insured that agree to participate in a managed care program with a limited provider panel, a further premium reduction of up to 20%.82 Even though the premium is set independent of income, the law mandates that no one should spend more than 10% of his income on health insurance. The cantons regulate the process of subsidizing the health insurance costs for low-income receivers.

In addition to the mandatory compulsory insurance coverage, which is mandated to offer a standardized coverage package, the Swiss have the option to purchase supplementary insurance coverage for better hospital accommodation, treatment by the head physician and other treatments not covered under the standard compulsory benefit plan. About half of the compulsory insurance providers, as well as other private insurance providers, offer supplementary coverage, and any insured is free to pick any supplementary insurance provider. The premiums for the supplementary insurance coverage are risk based. Furthermore, a voluntary daily cash benefit insurance scheme exists that replaces income lost to sickness. Employers often purchase supplementary insurance as a fringe benefit in the form of group insurance for their employees.

3.1.3.2

Swiss Literature

Colombo (2001) focuses her research on characterizing insurance switchers. Using individual survey data, she finds that 84.4% of those surveyed never switched their insurer

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Choosing the 1500 Sfr deductible causes a premium reduction of up to 40% over the base premium with 230 Sfr deductible. About 55% of the insured choose ordinary plan with the lowest possible deductible. Colombo (2001)

and, of those, 88.2% do not have the intention to ever switch. During the first two years of the new system about 5% of the sampled population switched in either year, and in 1999 and 2000 the share of switchers shrank to 2.7% and 2.1%. The healthier are more likely to switch than those with a poor health status, and those in the age range from 26 to 40 are most likely to switch. She identifies several categories of non-switchers. “Passive non-switchers” are those who would never consider switching unless some major performance or price shock occurs, because of their aversion to change, insensitivity to insurer performance or because they a priori consider the costs of switching as too high when compared to the benefits of switching. She estimates this group to consist of about 30% of the non-switchers. A second category consists of the “informed or non-informed non-switchers”. Colombo estimates that more than half of the non-switchers belong to this category. The “informed non-switchers” are those who compare costs and benefits, but find it beneficial to remain with the current provider. The “uninformed non-switchers” do not find worthwhile to compare funds because they are either happy with their current fund or find the search cost too high. The last and smallest category are the those who think that they cannot switch because they are either unaware of the changes in the system, have experienced illegal cream skimming or wrongfully think that pre-existing conditions prevent them from being eligible to switch.

Switching amongst different plans within one’s fund is actually much more prevalent than switching between funds. More people make an insurance choice by changing the deductible or moving in or and of a managed care plan or the “bonus insurance” contract while staying with their insurer than switch insurers.

Switching seems to be predominantly motivated by premiums. About 26% cite rising premiums as the main reason to switch, while 17% cite better premiums elsewhere. Further,

7% cite an insufficient premium/benefit ratio (which is somewhat surprising given that the benefits are standardized and only service can be heterogeneous). About 25% give a reason other than price and another 25% give no reason or “other reasons”. These data suggest that approximately two thirds of those responding with a reason for switching mention the premium as the trigger for switching.

One of the goals of increased consumer choice is efficiency gain. Colombo states that having huge numbers of switchers is not necessary for the achievement of efficiency gains. Even small numbers of switchers can discipline providers by signaling that the market is contestable. On the other hand, too much switching can be inefficient because the process of switching itself causes administrative costs.

There has been no research in Switzerland to date that measures the price responsiveness of the insured. Therefore no benchmark estimates are available for comparison with this research.