Analysis: Health system reform falls short

With the Diet’s approval of a revision to the Health Insurance Law, many observers are frustrated with the less-than-anticipated results of well over half a year of heated and repeated discussions.

In the view of experts on medicine and medical economics, lawmakers seem to have produced almost nothing substantial to deal with reform of the nation’s health insurance system. The amendment will merely postpone by about two years the expected bankruptcy of the system — achieving far less than what was originally targeted, they say.

“I think that the revised legislation will bring about a small and temporary effect, if any, to contain expenditures for prescription drugs,” says Yoko Kimura, an associate professor of social welfare and medical economics at Nara Women’s University. Under the revised law, outpatients will have to make additional payments for prescription drugs — between 30 yen and 100 yen per day in accordance with the number of different drugs they receive — starting in September.

The public sharing of drug prescription bills has been one of the major issues in the review of the medical insurance system, which faces bankruptcy if left unchanged. Japan consumes the largest amount of prescription drugs in the world. “What is necessary are essential and drastic measures. But I think the legal revision can be interpreted (as a sign) that the government hopes to avoid a financial crisis only for a while and at the expense of patients,” says Hirokuni Beppu, vice director of the Tokyo Metropolitan Kita Medical and Rehabilitation Center.

A project team on the reform — consisting of the ruling Liberal Democratic Party and its two smaller non-Cabinet allies, the Social Democratic Party and New Party Sakigake — has held dozens of meetings since late last year to deliberate steps to salvage the health insurance system from a sea of debt. Since 1961, Japan has legally required its citizens to be insured under public medical insurance schemes, which are generally acknowledged to have significantly contributed, and at a relatively low cost, to great improvements in the life expectancy of Japanese. Therefore, experts say, there is national consensus that the system should be maintained.

The project team’s debate on the reform has so far ended up imposing on the public additional burdens stemming from prescription drugs and overall medical bills. The most immediate impact will be felt by salaried workers and people over 70. The amendment will amount to an annual 2 trillion yen increase in the economic burden on patients, according to the Japanese Communist Party, which has severely criticized the ruling camp for the revision.

Despite higher patient costs, the health insurance system will generate more than 330 billion yen in debts in fiscal 1999, according to an estimate by the Health and Welfare Ministry. This is because there has been no reform focused on the debt-generating structure of the system.

Members of the ruling alliance have admitted that the legal revision is a stopgap measure and “real, drastic reform measures should be drafted by the end of August, just before the new burden increases are to be imposed.” However, it is questionable whether they can achieve this within the next two months or so, after having failed to produce any meaningful, structural reform measures during the past half year, mainly because of powerful lobbying against the move by the pharmaceutical industry and the Japan Medical Association.