Starting in 2026, the Canton of Zug will cover almost all inpatient hospital costs for its residents.
In other words: if you live in Zug and are hospitalized, you’ll pay practically nothing – neither you nor your health insurance company.
Specifically, the canton will cover 99% of hospital costs, and the mandatory health insurance will cover just 1%.
This measure applies only for the years 2026 and 2027. After that, the situation will be reassessed.
Why Is the Canton Doing This?
Zug has generated substantial budget surpluses in recent years.
Instead of letting the money sit idle, the cantonal government wants to directly relieve its residents.
A large part of health insurance premiums comes from hospitalizations.
If the canton takes over that portion, insurance companies can lower premiums.
The estimates:
👉 Around 18% lower health insurance premiums,
👉 roughly CHF 700 per person per year.
Who Benefits?
Only people with official residence in the Canton of Zug.
That means: if you are taxed in Zug and live there, the canton will cover your inpatient hospital costs in a listed hospital (one covered by basic insurance).
Those living outside the canton will not benefit.
For example, if someone from Lucerne or Zurich is treated in Zug’s cantonal hospital, everything remains as usual:
- The health insurance covers its share,
- the patient pays the deductible and co-payment,
- and the person’s home canton covers its share according to the inter-cantonal agreement.
In short: It’s free only for Zug residents – and only for inpatient treatments.
Which Treatments Are Included?
The measure applies to inpatient stays – cases where you spend the night in the hospital.
Outpatient treatments – such as doctor visits, physiotherapy, or day surgeries – are not affected.
Dental care, medication, and supplementary insurance coverage also remain unchanged.
What Does This Mean for the Tax Return?
Many assume: “If the canton pays the costs, I’ll save taxes.”
That’s only partially true – here’s why:
- In your tax return, you can deduct medical expenses that you’ve paid yourself.
- In Zug, these costs are only deductible if they exceed 5% of your net income.
- But if the canton covers almost everything, you’ll have no hospital costs left to deduct.
Example:
Someone earning CHF 100,000 can only deduct medical expenses above CHF 5,000.
If the canton pays for everything, there are no deductible costs – so no tax advantage, but a clear direct financial relief instead.
Does This Mean You Lose Out on Taxes?
No – but you’ll have fewer deductions.
Zug residents save real money through lower premiums, even if they can deduct less on their tax return.
Overall, the effect is neutral or slightly positive, depending on income and situation.
A CHF 700 annual premium reduction is far more noticeable than a small tax deduction that only benefits a few.
Conclusion
The Canton of Zug is sending a strong message: instead of hoarding money, it’s directly supporting its residents.
For most Zugers, this means lower real expenses – through cheaper insurance premiums and almost no hospital bills.
The impact on tax returns is minimal and mostly neutral.
The key points:
- The measure applies only in 2026 and 2027.
- It applies only to inpatient treatments.
- It applies only to residents of the Canton of Zug.
Everyone else pays as usual – there’s no free ride for patients from other cantons.
In short:
If you live in Zug, you’ll enjoy two years with lower premiums and no hospital costs.
If you live elsewhere, you’ll pay as before.
Tax-wise, everything stays under control.
