There is little doubt that Japan's universal health coverage has been one of the nation's great success stories. The second paper in The Lancet Japan Series looks at how the system has succeeded, and the huge challenges it faces in the future as Japan's demographics and employment patterns rapidly change. This second paper is by Naoki Ikegami, Keio University School of Medicine, Tokyo, and colleagues.
Enforcement of the same fee schedule for all plans and almost all providers has maintained equity and contained costs over the past 50 years. The out-of-pocket co-payment originally varied greatly but has since become the same for all (30%), apart from children and elderly people who have lower rates (20% for children and 10% for almost all people aged 65 and over). Once the co-payment exceeds a monthly threshold, any excess co-payment is only 1%. However, inequities in the system remain, especially in the proportion of income levied as premiums, which can be three times as high in citizens-based plans (eg for the self-employed) as in those administered by large companies with many covered at a lower unit cost. Thus when employees retire they can suddenly find themselves paying much more for their health insurance at a time when their income is generally falling.
The ageing society of Japan is threatening the sustainability of the system. Put bluntly, fewer people will be working in the coming years and they will be supporting more elderly residents who have retired, which means higher premiums. Changing employment patterns are also an issue: more temporary and part time workers are being hired, since anyone who works less than 75% of full time hours need not be covered by employee plans. Some people who are not covered by employee plans are refusing to take up citizens' health insurance despite being legally required to do so. The result is an emerging population of uninsured Japanese. The proportion of people on public assistance (including unemployed and disabled people) has risen by 10% to 2 million between 2010 and 2011. This is placing pressure on both the national and municipal governments, who must cover 75% and 25%, respectively, of the medical costs for these people. Yet numbers on public assistance can vary by up to 11 times between municipalities.
There are currently some 3500 different health insurance plans within Japan. The authors say: "We believe the way forward would be to consolidate social health insurances plans. Consolidation would equalise premium contribution rates across plans, increase total funding by raising the contribution rates of plans currently set at a low level, and improve administrative efficiency by expanding risk pools."
They conclude: "Japan's major accomplishment with social health insurance, from a global perspective, has been its successful pursuit of the normative goals of expansion of coverage and containment of costs while improving equity in the health system over time. Japan offers several lessons for other countries…[however] countries that might consider adopting Japan's model of social health insurance should plan in advance to address its weaknesses before opposition to structural reform becomes deeply entrenched."
Naoki Ikegami, Keio University School of Medicine, Tokyo. T) +81-3-5363-3773 E) nikegami@a5.keio.jp
Journal
The Lancet