Coalition allies reach agreement on health insurance reform

The Liberal Democratic Party scored a political victory May 6 when it reached an agreement with its two non-Cabinet allies on a bill that would at least double medical bills, starting Sept. 1.

After long and heated debate, the LDP got the Social Democratic Party and New Party Sakigake to agree on revisions to the bill to reform the medical insurance system, and hopes to have it pass the Diet during the current session. The Democratic Party of Japan participated in finalizing the revision but decided not to take part in submitting the revised bill to the Diet, saying the planned burden increase will not win support.

The DPJ is still expected to vote for the bill, which is designed to cope with the financial crisis in the medical insurance system. The LDP, SDP and Sakigake agreed to charge additional fees to outpatients for prescription drugs in an effort to prevent public money from being wasted through excessive prescriptions.

Under the new agreement, outpatients who are prescribed between two and three kinds of drugs would be charged an additional 400 yen regardless the period of medication. The fees would be 700 yen for outpatients who receive between four and five kinds of drugs, and 1,000 yen for those who are prescribed more than six kinds of drugs. There would be no additional charge to outpatients who receive one kind of drug. The original plan, drafted by the three parties in late December, said outpatients who receive prescription drugs would be charged at a rate of 15 yen per drug per daily dosage.

The revision is intended to inform patients of the cost of prescription drugs. By becoming aware of the cost, patients will scrutinize what they are prescribed, the ruling camp hopes, believing this will result in discouraging doctors from overprescribing medication. Currently, prescription drugs are included in overall medical fees. As a result, patients are not aware of the cost of drugs, according to the three parties.

About one-third of the nation’s entire medical budget goes for drugs, considerably higher than other industrialized nations, whose similar expenditures account for less than 20 percent of the entire medical bill. It is believed Japanese doctors prescribe more kinds of drugs because the medical system allows them to make more money if they do so.

However, it is not certain that the new system will work to suppress expenditures on drugs, according to analysts. The revision is also intended to ease the possible financial burden on people who are prescribed more kinds of drugs.

The SDP demanded measures be included to avoid imposing a larger financial burden on the aged, who tend to be prescribed more drugs due to chronic diseases associated with aging. New public sharing of the prescription cost was a major issue in the review of the medical insurance system, which faces bankruptcy if it is left unchanged.