The House of Representatives Committee on Health, Labor and Welfare approved a bill Wednesday aimed at establishing an independent public corporation to take over the management of national hospitals.
The full Lower House may put the bill to a vote Thursday.
The planned organization, the National Hospital Institution, would inherit the 840 billion yen in debts piled up by 144 government hospitals. It would seek to clear them by fiscal 2028.
The legislation stipulates that the institution should promote the adoption of financial efficiency and accounting practices based on private-sector practices.
The institution would also be responsible for privatizing national hospitals.
Chikara Sakaguchi, minister of health, labor and welfare, has indicated that the head of new institution would be chosen from the private sector.