The Swiss Example

So can any wealthy, modern country get health care right without resorting to socialism? Yes. You never hear it touted by the media but Switzerland uses market forces, not government rules and red tape, to create a private, affordable, high-quality health-care system for its 7.5 million citizens. And it spends 40 percent less per capita than we do.

Sen. Tom Coburn, an Oklahoma Republican, a fervent fiscal watchdog and a practicing physician, knows all about the Swiss system. Much of his proposed health-care reform bill — the Universal Health Care and Access Act — is modeled on it. Coburn’s plan, a major overhaul that can be found at coburn.senate.gov, is complicated, controversial and in no danger of becoming law anytime soon, if ever. The bill’s key elements include achieving universal health-care access by using tax credits to pay for individual or family insurance, phasing out reliance on employer-based insurance, allowing people to choose their own doctors and health insurance and stressing preventive care. On Wednesday, Sen. Coburn explained why he likes the Swiss system, which operates sort of like our car insurance: You must buy health insurance but you can choose among many plans from many private companies. Since every Swiss is covered, Coburn said, there is no cost-shifting — i.e., no hidden subsidizing of those who don’t have insurance at all or don’t have enough. Cost-shifting costs Americans about $250 billion a year, Coburn said. Ending it would save a family of four about $4,000 a year. Another virtue of the Swiss way, Coburn said, is that it has fostered a range of innovative insurance products. For example, there are five-year policies that reward customers with lower and lower rates if they do the preventive things the company asks. A third virtue, he said, is a national high-risk pool that all insurance companies contribute to that essentially protects companies from suffering heavy losses in a given year.
Switzerland is tiny and doesn’t have our social problems. But Coburn says its consumer-driven approach — which is transparent to consumers in price and quality — would work here. Coburn knows markets aren’t perfect. But he knows why the Swiss system works so well: ‘It forces people to shop, it forces people to make decisions….The point is, markets work — if, in fact, we’ll trust them.’