Health insurance premium trends in 2024
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As every year, the release of the new Swiss health insurance premiums is expected in the autumn. In 2024, another rate hike is predicted by industry specialists. The rising cost of healthcare largely accounts for this increase. It is imperative for individuals to anticipate this expense, by considering comparing prices between insurers. It will also be important to know how much prices will actually rise.
Lamal premiums 2024: an inevitable price rise
Despite the stability of health premiums for many years, the successive increases in 2023 and 2024 are not surprising. Indeed, the current context explains quite simply the need for insurers to change prices.
The impact of Covid-19 on the price of healthcare in Switzerland
In Switzerland, compulsory insurance works through the payment of premiums by individuals. Insurers establish financial reserves, which are used to finance the various treatments reimbursed to them.
With the global covid 19 crisis, the reserves of all insurers were put to the test. There has been an increasing rise in healthcare expenditure, due in particular to hospitalizations. Many medical procedures and treatments were also postponed during this crisis.
If insurance players managed to maintain their prices in 2021 and then in 2022, the increase logically occurred in 2023.
The reduction in insurers' reserves
In Switzerland, insurers are required by law to have sufficient financial reserves to cover insurers' healthcare expenditure. The coverage rate achieved must be 100%, to meet what is known as the solvency requirement.
Events in recent years have prompted insurers to change their strategy with regard to this reserve. Many of them now want to build up reserves of 150 or 200%, to be able to cope with any future crisis.
For insurers, this is reflected in the rise in Swiss health premium rates, noticed since 2023. This information suggests that increases are likely to continue in the years ahead.
Ultimately, what are the reasons for the premium increases for 2024?
A number of reasons are put forward to explain this situation: firstly, there is a growth in bureaucracy that is gaining momentum. Secondly, there is a shortage of cheap drugs available on the market. In addition, there is an increase in psychological treatments on offer. In addition, the implementation of the Care Initiative has also contributed to this situation. Finally, there has been an increase in the number of consultations for minor health cases.
Santésuisse expects health premiums to rise by 8-9%
Verena Nold, Director of Santésuisse, estimates that health insurance premiums should increase by 8-9% for 2024 to offset rising healthcare costs.
Interviewed a few days ago on SRF radio, Ms. Nold stresses the fact that the reserves of the health insurers are too small to keep premium increases low, despite pressure from the FOPH.
After a 6-7% increase in 2023, this year's premium aumgentatin is once again unavoidable: "The reserves are exhausted" says Ms. Nold.
Long-term solutions to lower premiums
According to Verena Nold, the decrease in healthcare costs will lead to a fall in health insurance premiums in the long term. To support her point Ms. Nold points out that generics are twice as expensive in Switzerland as they are abroad.
However, it is possible to cope with the increase
Ms. Nold also highlighted the fact that it is possible to offset rising health insurance premiums by choosing a less expensive model such as the family doctor.
Higher health insurance premiums: who's affected?
There are an increasing number of articles talking about rate hikes when the new health insurance premiums come out in 2024. It's important to point out that not everyone will be affected in the same way.
The cantons where rates are rising
Insurance premium prices are determined by canton. From one canton to another, the Swiss will therefore not have the same amounts to pay, for equivalent guarantees. The same logic applies to price increases. It is therefore possible that some cantons will be subject to higher increases than others.
For the moment, information is lacking to try and anticipate the areas where rates will increase the most. we'll have to wait until the autumn, to map rate evolutions.
Profiles concerned
Lamal is also calculated according to the insured's profile. With different insurers, it is therefore possible that the price increase will be passed on more to one type of profile than another. This may depend on age, professional situation or medical history. Here too, it's rather difficult to target those who will be most impacted by the rise in premium rates in 2024.
Lamal's price hike: what about cross-border commuters?
Mandatory health insurance in Switzerland also applies to foreigners working in the country. For example, French nationals who come to work in Switzerland have the choice between Lamal or CMU, which corresponds to the French scheme.
The latter will also be impacted by the premium increases announced for 2024. For those who have not yet chosen between Lamal and CMU, reflection therefore begins in light of these rates, which are set to rise.
Evolution of average monthly premiums
Who decides Lamal premium prices?
The difficulty in anticipating premium prices for 2024 is explained by the way they are set. Insurers are almost sovereign in the matter.
Health insurance funds
Each insurance fund fixes its rates according to its needs. The aim is to ensure sufficient funds are collected to meet the coming year's healthcare expenses. It's also necessary to fill the famous reserves, which are used to anticipate crises.
The health insurers then only have a duty to inform their customers. Tariffs will therefore be communicated at the start of the 2024 school year, to enable policyholders to switch before the contract expires.
The Federal Office of Public Health
The Federal Office of Public Health, also known as the OFSP, has a budget control role for health insurance funds. Strictly speaking, it does not set health premium prices for 2024. It will, however, ensure consistency between the health funds' budgets and the premiums charged. He is therefore the guarantor of budget consistency.
My 2024 premium is going up: what should I do?
The increase in 2024 premiums seems inevitable for almost all individuals in Switzerland. If the impact on your budget is too great, some tips may help.
Changing compulsory insurance
Every year, when the contract with a health insurance company expires, every individual has the possibility of changing insurance. To do so, a cancellation letter must be sent before November 30.
According to legal requirements, every Swiss citizen must have a commitment with a health insurance company. Individuals will therefore have until December 30, to take out a new contract.
As you will have understood, you are not committed ad vitam æternam with your insurer. You have plenty of time to change at the start of the school year 2024, when the new rates are announced.
Changing supplementary insurance
Mandatory insurance is not, in principle, the only contract held by individuals. Most of them have supplementary insurance, which supplements the scheduled Lamal reimbursements.
When compulsory health insurance premium rates rise, many individuals choose to reduce their budget by renting supplementary insurance. This is indeed a good solution for controlling your healthcare expenses.
Before simply cancelling this type of contract, don't hesitate to compare rates. Insurers generally offer preferential rates to new customers. So by simply switching, you could potentially make valuable savings.
Compare 2024 premium prices
When the rates for 2024 are announced, it will be crucial to compare the different rates charged by insurers. For an effective comparison, you need to compare equal cover. Price should not be the only information guiding your choice.
This advice is all the more pertinent when it comes to choosing supplementary health insurance. Indeed, each insurer offers different options, which may correspond to your profile. The amount of the deductibles to be paid to obtain the triggering of coverage can also vary greatly, depending on the price of the premium paid for the year.
Measures to curb price rises
To enable the Swiss to retain purchasing power, we've seen various proposals emerge. While some are already in place, others remain merely in the planning stage. They could nevertheless change the game in the months to come.
Price limits based on income
The Socialist Party has proposed limiting the share of compulsory insurance occupied in the income of individuals. The idea would be to limit the price of premiums to 10% of income. The proposed rate would thus be adapted to the profile, but also to the actual financial means of the individual.
While this idea would make it possible to spread the cost of the healthcare system, according to wealth, calculations need to be made to measure the viability of this solution. Insurers must indeed manage to raise sufficient funds to meet their obligations.
The reduction of insurance fund reserves
The reduction of insurance fund reserves has already been proposed. It is because of this that the reserves of some funds were insufficient to cope with the increasing healthcare expenditure of recent years. In the event of new limitations, the possibility of a new crisis will therefore have to be taken into account.
Tax deductions for health insurance premiums 2024
The Federal Council is proposing to increase tax deductions for health insurance premiums. It also invites an increase in tax deductions for savings. Each canton has its own limitations in this area. For example, in the canton of Zurich, the limit is set at 2,600 francs.
This would effectively enable the Swiss to cope with the premium increases scheduled for 2024. It would also enable everyone to be able to continue to finance the health cover they need. Repeated price rises do indeed raise fears of a decline in the quality of care received, for want of the means to finance adequate insurance. So it's only natural that the government's proposals should be built around a long-term vision.
Updated on: 28.08.2024Written by Alexis MilonHead of health insurance department at Comparea.To learn more about our team click here.