Elements of parliament have called for premium reductions on Swiss health insurance to be applied automatically, following the news that a large number of eligible people forgo the benefit. The cost of basic and supplemental health insurance in Switzerland has continued to increase, having risen by 8,7 percent on average last year.

Can I apply for a health insurance premium reduction?

In all 26 Swiss cantons, residents are entitled to apply for so-called premium reductions (IPV) on their health insurance. These are awarded if a person’s annual health insurance premium exceeds a certain percentage of their salary or total income - this threshold is defined by the canton. 

While the criteria for applying vary, generally cantons offer the benefit to those on lower incomes - in Canton Zurich, for example, adults over 25 years old with no children have to earn less than between 54.540 and 64.470 francs a year, depending on location, in order to apply. Once approved, the canton then subsidises the insurance premium so that it does not exceed a certain percentage of the recipient's income.

Eligible people in Switzerland not applying for cheaper health insurance

However, it must be noted that in 19 of the 26 Swiss cantons, the premium reduction has to be applied for in writing, and according to the Tages-Anzieger, this has resulted in people forgoing the benefit despite being eligible.

In Canton Glarus - one of the few regions that keep data on the issue - 25 percent of people who are eligible for cheaper health insurance do not apply for it every year. In Appenzell Ausserrhoden, around 15 percent of those eligible for the benefit do not apply, saving the canton 5 million francs last year. 

While the reasons for not applying remain unclear, the Tages-Anzeiger placed the blame on a lack of knowledge about the scheme and / or a reluctance to apply because of a mixture of pride and shame.

Swiss cantons deliberately keeping premium reduction under wraps, says GLP

Speaking to the newspaper, Green Liberal National Councillor Patrick Hässig said it is obvious that Swiss cantons are deliberately making the application process vague and overly bureaucratic so that fewer people use the scheme. “Cantons are specifically counting on this and relying on the fact that some of those entitled to premium reductions do not come forward so that they do not have to incur these expenses,” he argued

The findings are especially prescient given the dramatic rises in health insurance premiums since 2022 and the looming premium reduction referendum, due to be voted on in June 2024. If approved, no person’s Swiss health insurance would cost more than 10 percent of their annual gross income. While the plan has public support, the initiative has been met with alarm among lawmakers, who estimate that it could cost the government 12 billion francs a year by 2030.

For his part, Hässig argued that “instead of risking a yes to the very expensive premium reduction initiative, the current laws should first be implemented correctly and the IPV should be paid out to everyone who benefits from it and does not waive it voluntarily.” He concluded by proposing that premium reductions be given automatically by all Swiss cantons in the future.

Premium reductions are "needs-based", Zurich argues

In response to the call, Canton Zurich Social Security Office spokesperson Daniela Aloisi told the Tages-Anzeiger that the current system is “needs-based. Some people who are theoretically entitled to a premium reduction do not need it. For example, people with good educational qualifications or those who are supported by their parents.”

Urban Spescha, spokesperson for the same department in Graubünden, said that the population is well-informed about the scheme. When it came to the reasons behind people forgoing the benefit, he concluded that more research is needed.

For more information, and to see whether you can apply for a health insurance premium reduction, check out the official website.