Costs in the healthcare sector are rising and thus so are premiums. For Helsana CEO Daniel H. Schmutz, one thing is clear: in those areas where Helsana can impact costs, it will strive to do so even more in future.
Helsana CEO Daniel H. Schmutz on the roof of the head office in Dübendorf
Mr Schmutz, you regularly answer customer questions on the advisory hotline. Will you also be doing so this autumn?
Yes, of course. I am already looking forward to my work in all of the regions.
How can you explain in simple terms why premiums are on the increase once more?
Healthcare costs are increasing in general. Premiums develop in line with costs. However, this year the situation is particularly complex.
What is different this year compared to the past?
The risk compensation policy is changing, the Health Insurance Supervisory Act is now coming into effect and the guidelines for group contracts are being adjusted. These factors mean that the increase in premiums for certain insured persons is significantly above the average. On the other hand, there will also be reductions this year. We are responding to this challenge by consolidating our basic insurance subsidiaries: Avanex will merge with Helsana and Sansan will join forces with Progrès. In doing so, we are keeping a lid on the increase in premiums for our customers.
Costs are rising year on year because here in Switzerland we have high demands in terms of quality. Does this not mean that we should accept the steady increase in premiums?
As regards quality requirements, I am in agreement with you. We want to see a doctor immediately if something hurts. And we want hospitals that are as close to home as possible. However, I do not agree with the statement that this automatically leads to higher costs. False incentives and inefficiency are far more significant here.
Can you provide an example of where such false incentives are apparent?
Let’s take radiology as an example. A service which costs CHF 150 but for which bills of CHF 470 are issued. This high profit margin is a result of rigid regulations in the healthcare system. It is no wonder that the number of radiologists here has doubled since 2003.
Are there other examples?
There is a lack of healthy cut-throat competition here in Switzerland. Look at hospitals, for instance. The famous Swiss saying “jedem Täli sein Spitäli” (translated literally as “each little valley has its own hospital” and playing on the fact that even small areas in the country have very distinct identities) did not come about by accident. In Basel, just seven kilometres separate two hospitals situated in Basel-Stadt and Baselland because the half-canton border lies between them. The ongoing consolidation efforts being made by both governments are being met with great resistance. A further major problem is the rigid pricing regulations for medication. The prices for generic drugs, for example, are well above the international average. Here, we could save up to half a billion Swiss francs in a quick and simple manner.
Through the introduction of a so-called fixed-fee model. With such a system, it is not the medication that is paid for, but rather the active ingredient. This would result in greater competition between the different suppliers and therefore also lower prices. To this end, Helsana has put forward a specific draft regulation.
Why are these rapid solutions not simply being implemented?
Any adjustments would see some parties lose out, with certain sectors earning less. These are well organised. We also need to change our behaviour. An example: both of my sons play football. If one of their team mates is out injured with knee pain, everyone calls for an MRI. In days gone by, it would have been a matter of gritting their teeth and playing on.
And if we had to pay for this MRI out of our own pockets? Would that be a solution?
The people of Switzerland do not want a system that is income-based. Our managed-care models are far more efficient and fair. This means that a general practitioner decides whether an MRI with a specialist is necessary or whether three days of rest would suffice in order for the leg to heal. Furthermore, we need to increase the level of personal responsibility taken by each individual.
You are talking about health literacy?
Exactly. We need to make sure each individual has access to objective information that can help them with health-related issues. Customers often lack information and do not possess the overview and orientation they require in dealing with the entire healthcare jungle. We have already started in this regard in the area of cancer prevention.
And this approach would allow for money to be saved without having to sacrifice quality?
Yes, that is the case. But we can do a great deal more. Helsana will in future become even more involved when it comes to keeping healthcare costs under control.
How does Helsana want to exert an influence here?
We have a great deal of data which we analyse in studies on an anonymised basis. This allows us to prove the existence of false incentives and highlight where costs can be saved. The results of the studies allow us to increase the pressure on service providers. For example, if it is shown that certain treatments are unnecessary or – in some cases – are even counter-productive. We also work closely with healthcare officials in the individual cantons.
Where could the cantons make savings, for example?
In the area of hospital costs. Today, too much treatment is provided on an inpatient rather than an outpatient basis, a situation also driven by false incentives. Together with the Department of Health of the Canton of Zurich, we recently put together a list of procedures for which we are convinced it makes sense from both a cost and health perspective for them to generally be performed on an outpatient basis. Zurich is now considering whether to adjust the service mandate accordingly. If hospitals do not receive money from the canton for the performance of unnecessary inpatient procedures, these will automatically be conducted as outpatient procedures.
Where else will Helsana become involved over the long term?
We have to step up our role as a player in the healthcare sector even more and not only be an efficient insurer. We want to show commitment to our customers’ lives, to be there for them when they need us and not simply process their orders. We will also step up our involvement in the area of managed care. In Zurich, around one-third of all doctors are already organised in group practices, while in Ticino this figure stands at just 10 percent. In Ticino, costs in the area of basic care are increasing far more than in Zurich – a clear sign that managed care works. Healthcare is changing and we want to help shape it in future. But always in an appropriate manner and with a sense of proportion. And always in the interests of our customers.
Interview: Daliah Kremer