On 24 September 2015 the Federal Public Health Office (OFSP) announced basic Swiss health insurance premium increases for 2016. Many are in a state of shock. The average increase across all cantons and insurance companies is 4%, however this number masks huge rises for some. Increases vary significantly by canton, insurance company, level of deductible and type of plan. The most shocking increases were revealed for the low cost provider Assura.
Cantonal differences are also sizable. The worst affected cantons are Neuchatel (8.2%) and Jura (7.4%), with average increases around double the national average. The lowest increase is in Appenzell Innerrhoden, which will see an average rise of only 2.2%. Vaud, Valais, Geneva, Basel-Landschaft and Fribourg will see average rises of between 4% and 5%. The cantons of Zurich, Bern and Basel-Stadt will see average increases below 4%.
Assura premiums rocket
According to the newspaper Tribune de Genève, Assura’s premiums will rise by 9.3% on average across the country next year. The average rise in Geneva will be 10.5% and in Vaud 10.3%. However, again these averages mask even larger rises in some quarters. Based on numbers from the OFSP website www.priminfo.ch, a Vaud-based family of two adults, with the maximum deductable of CHF 2,500, and two children with no deductable, insured by Assura, on a Family doctor plan, will see their total premium rise by over 20% in 2016. For this family their annual bill will rise by around CHF 1,500 and Assura will no longer be the most affordable option. That prize goes to Supra according to the same OFSP website.
So what happened? Assura has typically had a high percentage of insured parties with the highest deductable of CHF 2,500. Those choosing this option often predict they won’t need to visit a doctor and tend to be low cost members. In 2014, 150,000 new people joined Assura, and fewer of them had the same low cost profile. This increased average medical bill payouts. In addition, those insurers with a high percentage of good risks are required to pay into common pot and Assura’s good historical aggregate risk profile meant it had to put over CHF 500 million into this central pot. These extra outflows have left the company with a hole to fill.
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According to the newspaper 20 Minutes, some in the Socialist Party suspect that some insurance companies kept their premiums low in the run up to the vote to create a single health insurance company. Authorities in Neuchâtel revealed that last years premiums were fixed at a level insufficient to cover costs, notably at Assura.
The CEO of Assura told the Tribune de Genève that premiums were too low for 2015. Since November 2014, Assura has seen a clear rise in medical bill reimbursements and the rise continued through 2015, he said. 2015 premiums were set in the summer of 2014 based on only 30% of that year’s bills, and the factors behind rising 2015 expense claims were unforeseeable when the 2015 rates were set, he explained.
One month to change insurer
Every insured person has the right to change the provider of their basic compulsory health insurance. Insurers must tell their members what next year’s premiums will be by 31 October. Members then have until 30 November to cancel their insurance contract. If an existing contract is not cancelled it automatically continues.
The OFSP recommends starting the process early to avoid missing the 30 November deadline. It is important to note that it is the date the cancellation letter arrives at the insurance company that matters and not the date it was sent. Using registered post provides proof a letter has arrived.
Once the cancellation letter has been sent and received, the switch to a new insurer becomes final when the existing insurance company receives a confirmation letter from the new one. This needs to happen before the end of the year to ensure uninterrupted coverage.
Insurance companies must accept anyone wishing to sign up for compulsory basic cover and everyone resident in Switzerland must have this basic insurance. The OFSP website provides a tool for comparing premiums.