Cost containment

What does cost containment mean?

In Swiss health insurance, cost containment (Kostendämpfung) refers to all measures intended to slow the growth of healthcare costs charged to basic health insurance. The point is not to cut benefits but to ensure that costs only rise as much as can be justified medically. The term is political: it stands for legislative amendments, tariff decisions and price reviews implemented by the Confederation, the cantons, insurers and service providers.

The background is a simple relationship: in basic health insurance, premiums follow costs. If the costs of doctor’s visits, hospital stays, medicines and nursing care rise, premiums rise with them the following year. Cost containment is intended to flatten this increase and thus relieve premium payers and taxpayers.

The FOPH cites several reasons for cost growth: demographic change with more older and chronically ill people, medical and technical progress, and an increase in volume that cannot be explained medically. Cost containment mainly addresses the last point: misaligned incentives in tariffs, prices and coordination.

The programme does not apply to supplementary insurance. There, insurers set their premiums based on their own calculations, supervised by the Swiss Financial Market Supervisory Authority (FINMA).

How it works

At the end of March 2018, the Federal Council adopted a cost containment programme. It is based on an expert report of 24.08.2017 with 38 proposals. The Confederation has bundled the measures into packages:

Not all proposals were implemented. The reference price system for off-patent medicines was part of package 1b, but Parliament rejected it.

There are also measures that do not require legislative amendments. These include the three-yearly review of all medicines on the List of Pharmaceutical Specialties. According to the FOPH, it has brought savings of at least CHF 700 million since 2017. Other examples are the revision of the Aids and Appliances List, tariff reductions for laboratory analyses and the Federal Council’s adjustment of the medical tariff structure TARMED. Since November 2024, the stakeholders have been working out additional measures at the “Round Table on Cost Containment”.

Legal basis

There is no single “cost containment” provision. The basis lies in several articles of the Federal Health Insurance Act (KVG). Art. 32 KVG requires all benefits to be effective, appropriate and cost-effective, and these criteria to be reviewed periodically. Art. 56 para. 1 KVG obliges service providers to limit their services to what is in the interest of the insured person and necessary for the purpose of the treatment; the insurer does not have to pay for services beyond that.

The more recent packages have amended the KVG in many places. Package 1a introduced, among other things, the obligation to send insured persons a copy of the invoice. Package 2, for example, creates the basis for electronic invoices (Art. 42 para. 3ter KVG) and pricing models with refunds (Art. 52b KVG). The cost and quality targets are set out in Art. 54–54c KVG: the Federal Council sets them for four years at a time, no later than twelve months before the start of the period, and a federal commission monitors developments.

Example: checking a copy of an invoice

The copy of the invoice introduced by package 1a is the measure you can use directly. An example with assumed amounts:

Sophie, 41, has a deductible of CHF 1,500. Her GP practice bills the insurer directly. On the copy of the invoice, which she has received automatically since 2022, she sees two consultations on the same day, even though she only visited the practice once.

What this means for you

Cost containment is a matter of policy, but there are three areas where you can do something yourself:

1. Check copies of invoices. Are the date, duration and services correct? Clarify unclear items with the practice first, then with the insurer.
2. Ask for cheaper medicines. Pharmacies may dispense a lower-priced product with the same active ingredients. Ask for one of the generics.
3. Choose the right model. GP, HMO and telemedicine models rely on coordinated care and are usually cheaper. The premium calculator shows the premiums of all models for your municipality.

You can see how the premiums of individual insurers are developing in the profiles under health insurers. If you want to switch to a cheaper model or another insurer for the following year, the deadline is 30 November; all dates are listed under deadlines.

Common mistakes

• Equating cost containment with cutting benefits. The measures target prices, tariffs and misaligned incentives, not the statutory list of benefits.
• Expecting premiums to fall immediately. Cost containment slows growth; whether premiums fall depends on how costs develop overall.
• Filing copies of invoices unread. Within the deductible, you pay for errors in invoices yourself.
• Taking adopted packages for law in force. Package 2 has been adopted, but many measures still need implementing provisions before they apply.