Health experts have long suspected that if a health insurance company fails to control its administrative costs, premiums are higher than other insurance companies — sometimes significantly. This means: whoever wastes premium payer money with high administrative costs usually also collects much higher premiums from his clients.
Or in other words: If the cash register is operating efficiently, customers benefit from lower premiums. The online comparison service Comparis has now shown this relationship between administrative costs and insurance premiums in a new study.
Regulations pay the costs
That’s no small feat: the administrative costs of health insurance will make up an average of 4.9 percent of premium income in 2020. That’s CHF184 per insured person. The trend is on the rise slightly: “Regulatory bureaucracy also increases administrative costs for health insurance companies, even for some of the most efficient ones,” warns Comparis health insurance expert Felix Schnole (61).
The Ingenbohl Institute for Health Insurance in the canton of Schwyz tops the list of the most effective health insurance companies. The Small Health Insurance Fund spent 666 francs per insured person on management. The premiums are correspondingly high.
754 francs per month: “That’s definitely too much for basic insurance.”(02:55)
High administrative costs in Helsana
But there are also some well-known and large health insurers among the 25 percent of insurance companies that waste a portion of their premium income on management. For example Mutuel Assurance (236 francs), KPT (274 francs), EGK (293 francs) and affiliates of Sympany Moove (265 francs) and Vivao (238 francs). In between, there is a Supra with administrative costs of 242 francs. Accordingly, health insurance premiums for these insurance companies are rising.
Among the very large companies in the field of health insurance, Helsana is at its worst: there, the administrative costs per insured are 226 francs.
Not only small and effective
“It is not yet clear whether this phenomenon will emerge in the future, that is, the most efficient health insurance companies also offer lower premiums,” Schneuwly says. “It would be good that way. And it would also be better if they also had the best customer satisfaction.”
Small regional health insurers in particular have been able to do business inexpensively. But there are also some great records among the top 25 most efficient cash registers.
Sumiswalder Krankenkasse was the most efficient health insurer in 2020. Bernice cut their management costs by 28 francs from the previous year from 128 to 100 francs and spent 2.8% of the size of their premiums on management. Last year’s winner, Luzerner Hinterland health insurance, came in second. Here the administrative costs rose from 99 Swiss francs to 105 Swiss francs per insured person. At 119 francs (+10 francs), the Sodalis Health Group was the third most efficient fund.
The study shows: Even large health insurance companies can handle premiums economically. Fourth place in the efficiency rating. Number 1 on basic insurance spent 134 francs per insured person in management last year – 4 francs less than in 2019. Visana and its Sanitas affiliate Compact also make it among the most efficient funds.
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