Is the Swiss Healthcare System a Model for the United States?

Physicians for a National Health ProgramBoston, Novermber 2013

Claudia Chaufan, MD, PhD, University of California San Francisco

The Massachusetts health reform more or less follows the Swiss model; costs are running higher than expected, but the reform has greatly reduced the number of uninsured. And the most common form of health insurance in America, employment-based coverage, actually has some “Swiss” aspects: to avoid making benefits taxable, employershave to follow rules that effectively rule out discrimination based on medical history and subsidize care for lower-wage workers. So where does Obamacare fit into all this? Basically, it’s a plan to Swissify America, using regulation and subsidies to ensure universal coverage

‘Similarities’Switzerland

Major reform=ACA, 2010

Retains commercial insurance policies Individual mandate“Affordable” plans with “essential” coverageNo discrimination on pre-existing conditions

United States

Major reform=LAMal, 1996Retained commercial health insurance policies Individual mandate“Affordable” plans with “essential” coverageNo discrimination on pre-existing conditions

The Illusion of SimilaritySwitzerland

Major reform=ACA, 2010

Retains commercial insurance policies Individual mandate“Affordable” plans with “essential” coverageNo discrimination on pre-existing conditions

United States

Major reform=LAMal, 1996Retained commercial health insurance policies Individual mandate“Affordable” plans with “essential” coverageNo discrimination on pre-existing conditions

MANDATORY PURCHASE OF HEALTH INSURANCE

Guaranteed QualityComprehensive Coverage

Cost ContainmentSolidarity/Equality

SWISS RESIDENTS

(99.9% OF POPULATION)99.9% of population

Out of pocketpayments (1CHF=$1.08)

-Premiums vary per Canton-Deductible CHF 300/year (Mx. 2,500) -Max. co-insurance: CHR 700 /year-Hospital daily rate CHF15-No age discrimination. 26 and above= same price (Age categories: 0-18; 19-25)

MANDATORY BASIC INSURANCE PLAN

Regulated @ the national level

Covers all TX’S and DX’S prescribed by a licensed provider for both IN & OUT PT care, certain medications and medical goods, a # of hours of home & LT care, and (some) complementary TX

Supplemental Insurance

-dental, vision, private rooms (88% pop.)

$ PR

OFIT

$

Source: OECD

Review of H

ealth Systems, Sw

itzerland, 2011

Insurance Companies(80 to choose from)

NO PROFIT!!

Risk Equalization

insurance co.’s pay into the same pool

Subsidies-1/3 of pop.-50% discount of premiums for children/young adults-maternity care exempt-income-based for lower incomes

So…what’s the problem???

Managed care plans (i.e. restricted provider networks) becoming more common (‘popular’) & insurance companies providing ‘incentives’ (e.g. lower premiums vs. higher deductibles) to sign on

Higher deductibles lead to increasing out of pocket expenses (foregone care for low-income groups); Restricted networks lead to access problems

High costs – only lower than U.S. & Norway (11.4% of GDP), including higher administrative costs due to multiple payers

Major premium price variations between cantons & regressive pricing (same for all income levels)

IN COMMON: RELIANCE ON PRIVATE FINANCING!!

Is the ACA really “Swissified” Health Care?!....

mandatory requirement to obtain health insuranceAffordable Care Act

Source: Kaiser Family Foundation, 2013

30 Million Leftover

Undocumented Immigrant

Opting out

Exchanges/Marketplace

Individual MandateEmployer MandateAffordable Coverage

Increased QualityReduced Costs

10 broad categories

Does not apply to all plans

? ESSENTIAL HEALTH

BENEFITSIncreasingly ‘consumer-driven’ (i.e. more out of pocket) Very poor

>65 yrsVeteran

American Indian

PUBLIC PLANS

GOVERNMENT

Employer Coverage, (FTE & business >50 people)

Subsidies < 400% FPL

Self Employed/Small Firm Employees

Low income

Middle income

High income

PUBLIC

OPTION

The reality United States

Builds on commercial insurers, tied to employment, income or ageInsurers CAN MAKE PROFIT from medically necessary coverage (skimpy & no national standard)RESTRICTED PROVIDER NETWORKS (‘PREFERRED PROVIDERS’) IS THE NORMVERY FEW COMPARATIVE SHOPPRICE CONTROLS ANATHEMA! Service A can sell at whatever price!Financially fragmented – ‘profitable’ patients in private plans, ‘unprofitable’ in public plans (increasingly privatized)Price discrimination by age. EXCLUDES UNDOCUMENTED IMMIGRANTS, VERY POOR (‘HARDSHIP EXCEMPTIONS!)

Switzerland

Builds on long history of social insurance – coverage no longer tied to employment, income or ageInsurers CANNOT MAKE PROFIT from medically necessary coverage (very generous & national standard)All insurers must offer plans THAT INCLUDE ALL PROVIDERS EVERYBODY CAN COMPARATIVE SHOP (even if most do not!)PRICE CONTROLS! (same service, same price)Large pool overseen by government -- risk equalization, healthy/sick same poolNo price discrimination by age, immigration status, etc.

Conclusions

• The ACA is NOT a ‘version’ of LaMAL – doesn’t “turn US into Switzerland” (Paul Krugman)

• LaMAL has problems – may even not be working for the Swiss

• The fallacious debate and spin obscure real problems and undermine search for real solution

• If the goal is universal, equitable health care, we need a real National Health Plan

What to do?

• Educate ourselves, family, friends

• Join the single payer Medicare for All movement

• Connect the dots (with other public policy issues – war-making)

• Demonstrate!

Thank you!

My appreciation to my colleagues atPhysicians for a National Health Program, for their years of struggle to achieve health care equity for the American people