Higher premiums due to greater administrative effort?
How efficiently a health insurance works is usually measured by the amount of its own administration costs. How much money does the health insurance company need for its employees and their salaries, how much does their own property cost and what is the annual amount for advertising and marketing? Exactly these costs make a big difference between different health insurances. While some are very economical, others drive up their own costs. True to the motto: What does the world cost?
However, current findings show that higher administrative costs do not necessarily mean that the health insurance in question is less efficient. The decisive factor is how the expenses are used and what premium income is offset by the expenses. In addition, higher administrative expenses do not necessarily mean that the premiums also have to be high, because they are only partially used to pay the administrative costs. A very small part, because at most health insurers the share of administrative costs does not even reach 4.5 percent, which are paid by the premium money.
Big differences among health insurers
A comparison shows that the differences between the individual health insurances are quite considerable. Here are two examples:
- Visana
With this health insurance, the insured pay around 3,700 francs per year. The administrative costs per person are around 127 francs, provided that this person is included in the basic insurance.
- Helsana
Here the average premium for an insured person is around 4,100 francs per year. However, the administrative costs for a person in the basic insurance are significantly higher and amount to around 212 francs.
Helsana tries to justify itself and declares that around 94 cents flow back to the insured person in the form of a benefit, and that for every franc that is paid in as a premium. This means that the real administrative costs are significantly lower and only amount to six cents per premium franc.
Don't see costs as a sign of quality
Experts assume that the expenditure that a health insurance company makes for its own purposes and which therefore falls within the scope of administrative costs cannot necessarily be seen as a good or poor quality health insurance. Cash registers that offer a very good quality of service are not represented per se with higher administrative costs. At the same time, not every cash register that has low costs for its own administration can offer poor service.
However, one thing is noticeable and this is common to all health insurances: the costs for your own administration have fallen by around 50 percent in recent years. However, the administrative costs are only seen in connection with the premiums or put in relation to them. Nevertheless: The differences between the individual health insurance companies still exist and it remains to be seen that the insurance companies work with different levels of efficiency. While some have only minimal costs, others make full use of what ultimately says nothing about the service offered.
Conclusion: Not every health insurance company saves on administrative costs
Some health insurance companies are constantly striving to keep their own costs as low as possible and allocate these lower costs to the premium money. Others are anything but efficient and thus increase health insurance contributions. However, the administration costs say nothing about the service of the cash register.
