Health Care Without Boarders

Sabrina Gartmann, Livia Kistler, Corinne RÐ"¤z, Eveline Wenger

Mike Jeive

Writing 2

26 June 2006

Health Care without Borders

Table of contents

1. Introduction 4

2. Swiss Health Insurance 6

2.1 Mandatory Basic Health Insurance 6

2.1.1 Insured Persons 6

2.1.2 Risks Covered and Benefits 7

2.1.3 Costs of the Mandatory Basic Health Insurance 7

2.2 Supplementary Health Insurance 8

2.2.1 Insured Persons 8

2.2.2 Risks Covered and Benefits 8

2.2.3 Costs of the Supplementary Health Insurance 9

2.3 Revision of the Swiss Health Insurance Law 9

2.3.1 Easing of the Territorial Principle 10

2.3.2 Transborder Pilot Projects 11

3. Impacts of Health Tourism on the Swiss Economy 13

3.1 Importance of the Health Care Sector for the Swiss Economy 13

3.2 Competitiveness of Swiss Hospitals 13

3.2.1 Further Easing of the Territorial Principle 14

3.3 Unemployment Rate 15

3.4 Impact on GDP 15

4. Positive Implications of Health Tourism 17

4.1 Helsana and CSS 17

4.2 Cost Reduction 18

4.3 Higher Economic Efficiency 19

4.4 Extended Freedom of Choice 19

4.5 Equally High Levels of Quality 20

4.6 Higher Comfort 21

5. Disadvantages of Health Tourism 22

5.1 Lower Level of Quality in Germany 22

5.2 Unfair Competition for Swiss Hospitals 23

5.3 Allocation of Complex Cases 24

5.4 Suspension of Employees 24

5.5 No Easing of the Territorial Principle within Switzerland 24

6. Conclusion 26

7. Bibliography 28

8. Appendix 32

1. Introduction

The issue of health tourism is a burning theme nowadays and so far no measure has been proven effective in reducing health costs up to present. Since 1950, health costs have increased rapidly in Switzerland. Whereas expenditures for health care only amounted to 3.5 percent of the gross domestic product (GDP) in 1950, they accounted for 11.5 percent of the GDP in 2003, equaling an amount of 50 billion Swiss francs (Oggier "Gesundheitskosten").

Along with incessantly rising health costs, Swiss insurance companies have increased health insurance premiums every year since to shift part of their costs to insurants. As a consequence of this action, they have become increasingly exposed to criticism as many people believe that Swiss health insurers do not undertake enough measures to reduce health costs. Under severe pressure, some of the largest Swiss insurance companies recently started to send Swiss patients to Germany in order to benefit from considerably lower prices for medical treatment.

Whereas Swiss insurance companies see a real chance to reduce costs by opening the health care sector to foreign countries, the association of Swiss hospitals and the Swiss rehabilitation clinics are among the parties putting emphasis on the negative implications health tourism could have on the Swiss economy.

In order to meet the concerns of both parties, the Swiss Federal Council laid the legal foundations for a stepwise market opening of the health care sector by the end of April 2006. According to the law changes passed, Swiss patients are to be allowed to receive medical treatment abroad within the scope of pilot projects which are either limited to specific regions or treatment. The pilot projects, which will be reviewed in terms of their efficiency and effectiveness in reducing health costs, will build the basis for a probable market opening of the health care sector in the nearby future (Federal Office of Public Health "Krankenversicherung: VerordnungsÐ"¤nderungen Ð"јber Leistungen Mundestreserven und Medikamente vom Bundesrat verabschiedet").

This paper dealing with health tourism consists of five main sections. In the first part, a brief overview of the Swiss health insurance system will be provided. In addition, this part will also illustrate the legal framework constituting the basis for the development of health tourism. Following this, the possible impacts of health tourism on the Swiss economy will be commented on. The third part will focus on the positive implications of health tourism whereas the fourth part will show the negative aspects. Finally, a conclusion from the point of view of the authors will be illustrated.

2. Swiss Health Insurance

The Swiss health insurance consists of the mandatory basic health insurance on the one hand and of the supplementary health insurance on the other hand. The aim of this section is to provide basic information on these two building blocks in order to increase understanding of the ongoing revision of the Federal Act and the corresponding Regulation on Swiss Health Insurance.

2.1 Mandatory Basic Health Insurance

The mandatory basic health insurance grants all people living in Switzerland adequate medical health care in the event of sickness, maternity, and accident (Comparis "Basic Health Insurance"). The Federal Act on Health Insurance (KVG) and the corresponding regulation on Health Insurance (KVV) of June 27, 1995 thereby constitute the legal framework for the mandatory basic health insurance.

2.1.1 Insured Persons

According to article 3 of the Federal Act on Health Insurance, every person domiciled