To create an effective healthcare system, we must understand the impacts of various incentives for healthcare providers and their organizational structures.
In Switzerland, as in many other countries, there are significant regional differences in healthcare costs. For example, a person in the canton of Basel-Stadt incurs an average of CHF 5,508 annually in basic insurance costs, while a person in the canton of Appenzell Innerrhoden incurs an average of only CHF 3,201 per year (Source: OKP Statistics 2023). These regional cost differences can have various causes. On one hand, the two cantons differ significantly in terms of their population structure. On the other hand, when considering the cantonal physician density measured in full-time equivalents, Basel-Stadt has 10.7 physicians per 1,000 inhabitants, compared to only 1.5 physicians per 1,000 inhabitants in Appenzell Innerrhoden, according to FMH data.
Selection versus control
Nearly 80% of the Swiss population choose an insurance model with restricted access to healthcare providers. These managed care models aim to reduce healthcare costs through targeted patient management. However, accurately measuring these savings is methodologically challenging.
By switching from a standard to an alternative insurance model, insured individuals in Switzerland can lower their health insurance premiums. Since premiums ultimately reflect the average healthcare costs of individuals within a given model, managed care models appear to reduce costs as intended. However, a superficial analysis of the data risks leading to biased conclusions.
Alternative insurance models are generally less attractive for chronically ill individuals due to the required contact with a gatekeeper, compared to those who use healthcare services less frequently. The latter are therefore more likely to switch to such models. As a result, individuals with differing health statuses systematically self-select into different insurance models. This self-selection leads to “mechanically” lower average costs for insured individuals in managed care models, without the models themselves achieving actual cost reductions. To accurately determine the impact of measures such as improved patient management, a “random” assignment to an insurance model with a corresponding control group would be necessary. However, such randomized studies are not feasible in basic insurance for various reasons. Therefore, accurate measurement relies on “natural experiments” and other methods from modern econometrics.
498
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4.6
This raises the question of to what extent not only patients' differing healthcare needs but also the availability of healthcare services influence observed demand. Compared to other markets, providers play a particularly significant role in the healthcare sector, as many services require a prescription. Therefore, it is important to understand how various incentives affect the treatment decisions of healthcare providers. Additionally, coordination within and between different groups of providers impacts the locally available supply of healthcare services, which in turn affects patients' ability to access certain treatments.