Further reform would strengthen Switzerland's benefits system, finds OECD


07/11/2006 - Switzerland should make sickness insurance mandatory for workers and introduce systematic sickness absence monitoring and management to help people stay in the labour market, according to a new OECD report.

These are among a series of policy recommendations in Sickness, Disability and Work: Breaking the Barriers - Norway, Poland and Switzerland that analyses the sickness and disability policies of these countries. It proposes steps the governments should take to cut the number of people claiming these benefits and help them back into the labour market. In Switzerland, the spending on disability benefits as a share of GDP was below the OECD average in the beginning of the 1990s but has doubled since then.

Currently, Switzerland is trying to tackle one of its key challenges: the late start of interventions to help people with health problems remain in their jobs. Most action typically comes at a stage when people have already lost their job. Connecting people with the disability insurance at an earlier stage through early identification of serious health problems is a promising approach. But the planned reform would have more impact if all the actors who are in contact with the sick person at an early stage, from employers to doctors, had a legal obligation to take action early.

The strong role of the private insurance market in disability also makes Switzerland a special case. The activities of these private players can be regulated but not managed directly. The different levels of coverage these private schemes offer contributes to inequalities across the population. To address this, a better balance needs to be created between obligations and incentives for private sickness benefit insurers. Sickness has to be better managed by those insurers and also monitored compulsorily. Also, a mandatory sickness insurance for all workers should be introduced.

Among the report's other recommendations are that:

  • The recently introduced experience rated premiums to sickness benefit insurance should be matched by stronger obligations and better support for employers. For instance, employers should be required to play a part in the preparation of a reintegration strategy.
  • Eligibility for rehabilitation should be widened to move the system from "rehabilitation before benefits" to "rehabilitation instead of benefits". More use should be made of vocational measures as a way of raising outflow from disability benefits.
  • Work incentives should be enhanced to raise outflows from disability benefits. These measures should be taken immediately and not postponed, as is currently planned.
  • Ongoing but voluntary inter institutional co-operation across different systems and institutions should be strengthened to further improve the flow of information between the various actors. Legally binding cost-sharing between the institutions, like in the canton of Solothurn, is one way of doing this.
  • The mismatch between funding of, and responsibility for, disability policies needs to be corrected. Better supervision and inspection of cantonal disability offices by the federal supervisory authority would be important in this respect.

A particular Swiss problem is the steep rise in mental illnesses as a cause of disability. Mental diseases have become the single most important reason for take up of disability benefits, accounting for over 40% of the total inflow in 2004, up from 28% in 1995. While the reasons behind this trend are still the subject of debate, the rise of mental health problems reveals weaknesses in the definition of disability and in the assessment and rehabilitation process. These should be addressed urgently.

Journalists can obtain a copy of Sickness, Disability and Work: Breaking the Barriers - Norway, Poland and Switzerland by contacting the OECD's Media Division (tel. +331 4524 9700). For further information, please contact one of the authors in OECD's Directorate of Employment, Labour and Social Affairs: Christopher Prinz (tel. +331 4524 9483), Patrik Andersson (tel.+ 331 4524 8851) and Michael Förster (tel. +331 4524 9280).


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