The Swiss National Council has voted to limit the salaries of executives working for health insurance providers. As the cost of health insurance is expected to rise significantly in the next year, supporters of the proposal say that savings need to be found.

Salary cap for Swiss health insurance executives passes lower house

In a vote on September 14, the National Council, the lower house of the Swiss government, voted to limit the “remuneration of members of the management of health insurance companies.” It follows a recommendation from the government’s Commission on Health and Social Security (SGK-N) to limit the benefits of top executives and their salaries.

If passed fully, the proposal means that anyone who is a member of the management team at any company that offers basic health insurance can only earn 250.000 Swiss francs a year from salaries and other benefits. Members of the board of directors at said companies would also be allowed to charge 50.000 francs a year towards “compensation” for flights, taxis, public transport, hotels and other expenses.

Supporters say insurers need to reduce costs

According to Swiss news site Watson, the main supporter of the bill, Social Democratic Party councillor Flavia Wasserfallen, argued that as the cost of basic health insurance rises, companies need to act to reduce costs wherever they can. While the government plans to reduce the cost of healthcare, doctors and medicine in Switzerland, she argued that health insurance companies should also take part.

Opponents of the idea, like FDP. The Liberals councillor Andri Silberschmidt, told Watson that the law itself would do little to reduce the cost of premiums. He argued that the idea was little more than “symbolic politics” and that it was not the job of the state to regulate the wages of workers in private companies.

Opponents argue the measure is symbolic and an encroachment

The executive Federal Council is also not keen on the idea. In a statement given to Keystone-SDA, they said that while they understand the criticism of high executive salaries, the proposal amounted to a “major encroachment on corporate freedom.” They also pointed out that they would only legally be able to restrict the salaries of executives involved in basic (mandatory) health insurance, not the far more expensive optional supplemental packages.  

The proposal passed the National Council by 113 votes to 74 with two abstentions. The law will now move to the Council of States for approval, and if all goes well, the Federal Council will be forced to draft the law to be voted on.