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Cantonal Differences in Health Care Premium Subsidies in Switzerland

Author

Listed:
  • Gerritzen, Berit C.
  • Martínez, Isabel Z.
  • Ramsden, Alma

Abstract

We study health care premium subsidies in the Swiss cantons in order to understand the reasons behind the substantial cross-cantonal variation in households' premium load, i.e., the share of disposable income that is spent on premiums after the subsidy. Cantons' financial situation is of particular interest in this regard, because the premium subsidies aim at reducing the premium load for lower income groups in order to ensure universal access to health care at affordable costs. Thus, variation in premium load is meant to reflect underlying differences between cantons in health care and overall living costs, or different preferences of the electorate with regards to social policy, but not budgetary considerations of cantons. We develop a premium subsidy calculation model based on cantonal regulations and apply it to households in the Swiss Household Panel to assess the effect of cantonal budget tightness on households' premium load from 2004-2012. Our analysis is based on panel regression methods and a difference-in- differences model in order to take into account unobserved heterogeneity and simultaneity concerns. The results indicate that there is a significant and negative relationship between the budget of a canton and the premium load of households

Suggested Citation

  • Gerritzen, Berit C. & Martínez, Isabel Z. & Ramsden, Alma, 2014. "Cantonal Differences in Health Care Premium Subsidies in Switzerland," Economics Working Paper Series 1420, University of St. Gallen, School of Economics and Political Science.
    • Handle: RePEc:usg:econwp:2014:20
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    File URL: http://ux-tauri.unisg.ch/RePEc/usg/econwp/EWP-1420.pdf
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    Citations

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    Cited by:

    1. Vaidya, Shalvaree, 2021. "The impact of premium subsidies on health plan choices in Switzerland: Who responds to the incentives set by in-kind as opposed to cash transfers?," Health Policy, Elsevier, vol. 125(6), pages 675-684.
    2. Christian P R Schmid & Nicolas Schreiner & Alois Stutzer, 2022. "Transfer Payment Systems and Financial Distress: Insights from Health Insurance Premium Subsidies," Journal of the European Economic Association, European Economic Association, vol. 20(5), pages 1829-1858.
    3. Kaufmann, Cornel & Schmid, Christian & Boes, Stefan, 2017. "Health insurance subsidies and deductible choice: Evidence from regional variation in subsidy schemes," Journal of Health Economics, Elsevier, vol. 55(C), pages 262-273.

    More about this item

    Keywords

    Health care premium subsidies; equity; health care financing; fiscal federalism; budget constraint; Switzerland.;
    All these keywords.

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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