The country of Japan is comprised of four main islands and numerous smaller ones. It has a land mass slightly smaller than that of California and a population of about 127 million. Japan is a constitutional monarchy with a parliamentary government and is divided into 47 prefectures (a prefecture is similar to a state). It has (2003) the second-largest economy in the world.
Q:
What kind of healthcare system does Japan have?A:
Year 2000 Organisation for Economic Co-operation and Development (OECD) figures show that Japan spends 7.6% of its GDP on health, compared to 9.2% for Canada and 13.1% for the US. In 1998, Japan spent ¥29.8 trillion (US$280 billion) on healthcare, of which 53% was covered by insurance, 32.3% by the government, and 14.8% by patients' co-payments. Officially, the patients' co-payment rate is 20 to 30%, but with co-payments capped, the effective co-payment rate is 14.8%. The cap is at ¥63,600 (US$600) per month, with the average monthly disposable income being ¥561,000 (US$5,300); additionally, there is a low-income cap.The Japanese healthcare system is highly regulated by the government and, as described by the OECD, "combines a mainly private provision of services with mandatory health insurance. Service providers are paid directly by insurers (the third payer system). Payments for outpatient care are predominantly on a fee for service basis, and inpatient care is paid through a mixture of per diem and fee for service. Fees for different medical services are set out in the Fee Schedule announced by the government and revised every two years. Between 20 and 30% of the fees are born by patients as co-payments. But with a ceiling (see below) the effective co-payment rate is about 14%."
Japanese healthcare providers are predominantly private hospitals and physicians. Hospitals must, by law, operate as not-for-profit entities. About 80% of hospitals are private, physician-owned, and 20% are large, public, state-owned teaching hospitals. In 2000, Japan had 1.9 practicing physicians per 1,000 population, while Canada has approximately 2.1 and the US 2.7. (They also have fewer nurses per capita than most OECD countries, at 7.89 per 1,000 population, lower than the OECD average of 8.1.) Public and private hospitals are staffed by salaried physicians. Private physicians practice and treat patients in offices or clinics and do not have hospital medical staff privileges. Both hospitals and clinics treat outpatients, and patients can choose where they want to undergo treatment.
All doctors in Japan are paid the same fee for each service. Specifically, the OECD report Health Care Reform in Japan explains, "Another characteristic of the Japanese system is a conspicuous lack of differentiation and standardisation. First, the fee for a given service is identical across service providers and does not recognise the difference in quality. Second, general practice medicine is not clearly established as a separate discipline, so that specialist doctors are not differentiated from general practitioners. Virtually all doctors in private clinics try to deal with all the problems of their patients."
Further, Health Care Reform in Japan states, "there is no legally imposed separation between prescribing and dispensing of drugs, even though separation has been increased through incentive mechanisms." The lack of separation of prescribing and dispensing contributes to over-prescription of medication through kickbacks paid by the powerful pharmaceutical industry.
Like most industrialized countries, Japan is faced with a rapidly aging population and a declining birthrate. In addition, Japan's economic growth has been stagnant for the past 10 years and continues to decline. These factors are plunging the overall medical system into deficit and increasing the burden on younger people, who must contribute more money to compensate for shrinking government revenue and the growing number of elderly people.
Q:
How is the system funded?A:
The roots of Japan's public health insurance go back to 1927. As stated above, services are covered by health insurance. Health insurers are required, by law, to offer a basic package of benefits (including medical consultation, drugs, and other materials; medical treatment, surgery, and other services; home care treatment and nursing; and hospitalization and nursing at medical institutions) and they may offer additional benefits (e.g., funeral benefits, maternity allowances) under the collective scheme.People are assigned a health insurer according to their employment situation. Those who are employed at a company or office are insured by the Social Insurance System (SIS). This system is funded by the employers (who pay varyingly from 50 to 80% of the cost) and by premiums paid by the employees. Everyone else (the unemployed, elderly, and self-employed, including lawyers, doctors, etc.) is insured through the National Health Insurance (NHI) system. The NHI system is funded by the government and the employed members of the system.
About 63% of the population is covered by SIS plans, which is delivered by about 1,800 entities nationwide known as Health Insurance Societies. Premiums depend on the employee's annual income, but amount to approximately 8.5% of their salary. An insured person and their dependents must, in addition to contributing the cost of the premium, pay 20 to 30% of inpatient and outpatient costs and make an additional co-payment for prescription drugs.
The remaining 37% of the population is covered by NHI, which is delivered through about 3,400 regional plans. Premiums for those employed persons covered by NHI depend on income, assets, and benefit payments from the previous year. The NHI also require co-payments of 30% for beneficiaries and their dependents.
A third type of insurance, known as long-term care insurance, was started in April 2000 to help cope with the aging population. (This insurance is funded half by the government and half by individuals aged 40 or older.) Users are enrolled both in health insurance and the long-term care insurance. To qualify for this insurance, which covers 90% of inpatient and outpatient health costs, as well as prescription medication, patients must be certified as in need of long-term care by a regional review board. Users must be older than 65 (or between 40 and 64 but with one or more of a list of 15 specific conditions, e.g., pre-senile dementia, cerebrovascular disease).
However, social admissions (usually of the elderly), with patients often admitted for treatment that is regularly done on an outpatient basis in other countries (e.g., diagnostic testing, minor surgical procedures, rehab, follow-up services), continue to plague the system and drive up costs.
Q:
What is the quality of care in each system?A:
The healthcare available to the average Japanese person is comparable to that in other industrialized nations. Urban Japanese medical facilities are well equipped, and Japan boasts the highest ratio of CT and MRI scanners per capita than any other country. The quality and availability of care is lower in rural areas due to the urban concentration of tertiary care facilities, a disparity that is being addressed by efforts to decentralize healthcare and make regional governments more responsible for providing and delivering services.Q:
What are current concerns among healthcare workers in the country?A:
There is a lack of emphasis on preventative healthcare, particularly with regard to smoking. About 54% of Japan's males and 18% of females are smokers, and smoking is the number one preventable cause of death in the country. The government, formerly the largest tobacco retailer in the country, is reluctant to impose higher insurance premiums and encourage people to quit for fear of alienating the powerful tobacco companies.Due mainly to the widespread taboos associated with sexual discussions, Japan also has the lowest public awareness of HIV/AIDS among industrialized nations, despite a steadily rising number of HIV/AIDS cases in the country. HIV infections for 2001 are estimated by the UNAIDS agency at 12,000, up from 7,320 at the end of 1998.
Q:
What are current concerns among patients?A:
Japanese people are traditionally unwilling to voice displeasure or unhappiness with the government, but rising healthcare costs are causing an increasing number of people to speak out. People are becoming more sensitive to quality of care, hearing of frequent reporting of medical errors, long waiting times for outpatient service in large hospitals, and an extremely short consultation time. Additionally, patients' access to information about their medical records is patchy at best, and the lack of physician peer review organizations or widespread hospital accreditation is causing some concern.Q:
What are the current challenges in providing healthcare?A:
The current strain on the healthcare system is calling for reform of the medical insurance system, the medical fee schedule, the drug pricing system, and improvement of the long-term care system.In January 2000, the Ministry of Health, Labour and Welfare introduced a reform plan calling for fundamental reforms in the current healthcare system, including a review of the current drug pricing system, the system for covering medical fees, methods of evaluating medical technologies, and the ideal combination of fee-for-service and fixed-fee payment systems.