Swiss Health Care

Swiss Health Care

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  1. In 2010, President Barack Obama signed into law the most sweeping health care legislation since Medicare to expand health insurance coverage to almost 50 million uninsured Americans.

    Since its passing, the Patient Protection and Affordable Care Act, also called Obamacare, has faced partisan scrutiny from states filing legal challenges to it and the Supreme Court hearing arguments about its constitutionality.

    In 1994, another wealthy, democratic, and ethnically and culturally diverse nation passed its own version of health care reform that closely mirrors Obamacare.

    In the almost two decades since LAMal narrowly passed via a national referendum, Switzerland has achieved universal health insurance coverage using free market principles at a much lower cost than the US.

    Satisfaction with the system is high as the Swiss can see any doctor without a referral and everyone is covered with insurance that is not linked to their employers. The Swiss can choose from a variety of plans and can switch plans every year.

    Switzerland at a glance

    Population: About 8 million people

    Size: 15,940 sq mi (about the size of Maryland)

    Percentage of GDP spent on heath care: About 12%

    Government: Federal republic, with directorial system and a direct democracy. The country is divided by 26 states or "cantons" and there are four recognized languages in French, German, Italian, and Romansh.

    Switzerland is not the typical European welfare state. It is a country that is business friendly, has high gun ownership, uses the Swiss Franc instead of the Euro, and also has enormously powerful insurance and pharmaceutical companies.

    How it Works

    Officially known as LAMal (translated from "the sickness"), Switzerland’s health care system is similar to Obamacare. The Swiss are required to purchase private health insurance via individual mandate and the poor are subsidized by the government.

    Unlike most universal health care systems that have a single payer insurance system, Switzerland relies entirely on private insurance companies. Former Swiss president Pascal Couchpin, of the center-right Free Democratic Party, noted in the PBS Frontline documentay "Sick Around the World":

    "We rejected it because we think if you have a single payer, which is also the only [party] who makes contracts with … all the providers, it will be dangerous, because there is too much power in the hands of the health insurance system. We think that if there is competition between the health insurance companies, there will be a certain control among themselves; they will denounce the excesses of the others, … and also they will try to provide better services, and so you can compare."

    Insurers are forbidden from making a profit from basic care and must accept everybody regardless of pre-existing conditions, gender, employment status, and age. Insurance companies can, however, make a profit from supplemental insurance.

    According to Frontline, the insurers negotiate with providers to set standard prices for services, but drug prices are set by the government. Because there is no single payer system, Swiss doctors are among the highest paid physicians in Europe.


    Prior to LAMaL, Switzerland had a similar health care system to the United States and faced similar problems. Insurance was voluntary with private insurers and private providers, but health care costs were rising and so were visits to the emergency room by the uninsured. About 95 percent of the country’s population already had voluntary insurance coverage, but insurers could cherrypick healthy and young candidates while sick and old patients got gamed out of coverage.

    In the early 1990s, former health minister and later president Ruth Dreifuss of the left-leaning Social Democratic party presented LAMal where everyone must purchase insurance with the state paying for the poor. In return, every citizen would have comprehensive medical coverage.
    Despite heavy resistance from private insurers and pharmaceutical companies, LAMal narrowly passed via national referendum.  



    According to Frontline, The Swiss system is the second most expensive in the world, however it’s still far cheaper than U.S. health care. Drug prices are still slightly higher than in other European nations, and even then the discounts may be subsidized by the more expensive U.S. market, where some Swiss drug companies make a third of their profits.
    Although costs have moderated, Switzerland must determine how much citizens are willing to pay as everyone pays a $750 premium with pressure raise it.

    What America can learn

    The Swiss example shows that even in a wealthy, capitalist society with powerful insurance and pharmaceutical companies, universal coverage is possible. CNN correspondant Fareed Zakaria notes that although the Swiss example cannot resolve the constitutional issues of the America’s current health care law, it suggests the inevitability of some version of Obamacare.


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