T.R. REID: [on camera] Yeah. Now, see, that's striking for an American because we would certainly say everyone's entitled to an education--
Pres. PASCAL COUCHEPIN: Yes.
T.R. REID: --everyone is entitled to legal protection, if you get in trouble with the law. But we don't say that everyone's entitled to health care.
Pres. PASCAL COUCHEPIN: Why? Because it is a profound need for people to be sure that if they are struck by destiny, by a stroke of destiny, they can have a good health system.
T.R. REID: [voice-over] Dreifuss, from the opposite political camp, agrees.
RUTH DREIFUSS: I think it's a basic human right. This is really the aim and this is really the reason why I think that everybody now, or a large, large majority, would renew the confidence in this system because they see what it means to have a universal coverage.
T.R. REID: But I wondered about LAMal's impact on drug and insurance companies. Pierre Marcel Revaz is CEO of Groupe Mutuel, one of Switzerland's biggest insurance companies. What's different here is that many Swiss insurers were already non-profit, so the transformation was easier than it might be for us. Ten years on, the insurers are doing fine. As in Germany, a lack of profit has not meant a lack of competition.
PIERRE-MARCEL REVAZ, CEO, Groupe Mutuel: [subtitles] It's very competitive because each company wants to keep its old customers and get new clients. So there's extreme competition for service and price.
T.R. REID: The benefit package here is fixed -- it's the same for everybody -- so companies compete in other ways.
[on camera] Is this one of the ways you compete with other companies? You say, "We'll pay faster"?
PIERRE-MARCEL REVAZ: [subtitles] Yes, it's one of the elements of competition, but the main one is the price.
T.R. REID: [voice-over] Groupe Mutuel has a strong incentive to keep administrative costs low.
PIERRE-MARCEL REVAZ: [subtitles] Our administrative costs are 5.5. percent, so we're performing well.
T.R. REID: Do you know what that figure is in American health insurance companies? The average administrative cost is about 22 percent, and you're running at 5 percent.
[voice-over] But where the Swiss insurance companies can make a profit is on supplemental coverage for, say, better hospital rooms. This is also how they attract more customers. But what about the drug companies?
[on camera] In America, the drug companies say, "Well, if you cut the price we get for the drugs, then we won't have as much money for research and innovation." Is that a legitimate argument?
RUTH DREIFUSS: It was the same argument here in Switzerland.
T.R. REID: I'm sure.
RUTH DREIFUSS: But I can say also that the Swiss pharmaceutical industry 10 years after this struggle is not bad. In the international competition, I think the Swiss are still belonging to the top 10. And when you hear them, they are not crying about the bad shape of their industry.
T.R. REID: [voice-over] That may be because Swiss drug companies still make more than a third of their profits from the less-regulated U.S. market.
[on camera] One of the problems we have in America is that many people -- it's a huge number of people -- go bankrupt because of medical bills. Some studies say 700,000 people a year. How many people in Switzerland go bankrupt because of medical bills?
Pres. PASCAL COUCHEPIN: Nobody. It doesn't happen. It would be a huge scandal if it happens.
T.R. REID: [voice-over] But here's Switzerland's challenge. Having achieved universal health care, it has to decide how much citizens are willing to pay. Today, an average monthly premium for a Swiss family is about $750. But there's pressure to raise the premiums. And it's already the second most expensive health care system in the world, although still much cheaper than ours.
[
www.pbs.org: Compare these countries' systems]
What's interesting about Switzerland is that after LAMal's success, people in this proud capitalist country see limits now to the free market.
[on camera] Could a 100 percent free market system work in health care?
Pres. PASCAL COUCHEPIN: No, I don't think that. If you do that, you will lose solidarity and equal access for everybody.
T.R. REID: Which is what you were finding in the late '80s.
Pres. PASCAL COUCHEPIN: Yes. We think that is a basic value of living in our society.
