Swiss long required to buy health insurance -- without the furor


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The linchpin of the healthcare reforms championed by President Obama is the requirement that most Americans buy health insurance, a rule that could be overturned by the Supreme Court.


The Supreme Court ruling, expected Thursday, will decide whether requiring people to buy health insurance is unconstitutional, as critics claim. The rule has been fiercely debated in the United States, but a similar rule requiring people to be insured has long been in place in Switzerland without the furor.

The Swiss government started requiring residents to buy health insurance from competing providers in 1996, as part of a federal law aimed at controlling costs and ensuring equitable coverage. Switzerland feared that under its old system, tied to employers, people were staying with jobs they didn’t want just for the health coverage, holding its economy back.

The Swiss system is seen as the closest analogue internationally to the Affordable Care Act. (Within the U.S., Massachusetts also has an individual mandate, successfully pushed into law by then-Gov. Mitt Romney, now Obama’s Republican election foe.)

Whereas many countries tax their citizens to ensure that as many people as possible have healthcare, the Swiss system is more like a private market.

That made the Swiss system more appealing to Americans who are wary of turning over health insurance to the government, such as conservative talk show host Bill O’Reilly, who plugged the Swiss model on his show. As “Obamacare” was debated, Switzerland was often invoked as a promising model.

“The results in Switzerland are just spectacular,” said Regina Herzlinger, professor of business administration at the Harvard Business School. In a recent analysis, she found that healthcare costs there have increased less than in other countries, such as Germany and the United States, when compared to GDP growth.

Swiss patients are highly satisfied with the system, though costs have been higher than in other wealthy, industrialized countries. (The U.S. is still more expensive.) Insurance analysts debate the reasons behind those higher costs, which have been chalked up to various things, such as the Swiss simply opting to spend more on plusher plans or the localized system that puts people into smaller insurance pools.

The Swiss system also has some key differences from the health law passed under Obama: Switzerland doesn’t have separate programs for the poor and elderly like Medicaid and Medicare, said Avik Roy, senior fellow at the Manhattan Institute for Policy Research. Swiss employers don’t offer health insurance, and people choose which plans they want for themselves. Switzerland also regulates its system much more heavily than the U.S. would under the Affordable Care Act, said Timothy Stoltzfus Jost, a law professor at Washington and Lee University. Insurers are barred from profiting from insurance and must cover a minimum package of benefits. That means that though Switzerland is the closest analogy for what the U.S. has planned, it is not a perfect example.

“Americans are exposed to much higher financial risk than the Swiss,” Jost said.

There’s another big difference to note as the Supreme Court prepares to issue its hotly awaited ruling in Washington: Mandating that the Swiss get insurance has not drawn outrage as in the United States. Herzlinger said most Europeans find the American debate “bizarre.”

In Switzerland and other countries where health insurance is universal, “individual freedom doesn’t mean you should be free to live irresponsibly, to say, ‘I’m young, I’m healthy, why should I need health insurance?’ They see it as a civic duty,” said Tsung-Mei Cheng, a health policy research analyst at Princeton University. “They may grumble, but they pay.”

Roy put it differently. ‘Our revolutionary roots and our history has always been one where we cherish individual choice,’ he said. ‘Switzerland is that way too -- but less so than we are.’

For the record 3:04 p.m. June 27: A previous version of this post mistakenly referred to Sweden not having programs akin to Medicaid and Medicare. The reference should have been to Switzerland.


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-- Emily Alpert in Los Angeles