Scandals are coming so fast and furious now it seems eons ago when nursing care provider Comsn Inc. was busted by the government for inflating the number of employees on its payroll. Actually, it was only last month, and at the time the media could only concentrate on the particulars, namely Comsn’s duplicity and the immediate effect the scandal had on individuals.

It was a classic case of not seeing the forest for the trees. Caregivers and “home helpers” would lose their jobs, and elderly people who relied on them would be stranded without assistance until new companies could replace them. As always, the poignancy of isolated cases was the hook: This is the sad result of Comsn’s selfish actions.

But since then the press has had time to look more carefully at the bigger picture, and while Comsn remains a villain, the entire kaigo (nursing care) system has come under a dark cloud. The main problem, as illustrated by Comsn’s inventing employees for an Aomori Prefecture care center, is a shortage of personnel. In order to receive or renew a license to provide nursing care, a care center must have a minimum number of people in its employ. But why is there a labor shortage in the first place?

Pay for nursing care workers is low and the turnover high. According to a special series in the Asahi Shimbun, the hourly wage is on average 600 yen less than the national average for hourly wage earners in all industries. More significantly, care workers, almost all of whom are women, are on call, meaning their pay is not guaranteed from month to month. Most for-profit companies do not reimburse for transportation costs or otherwise compensate for time spent traveling to and from the homes of “users.” They also don’t pay for time the care worker spends on administrative tasks, such as filling out reports. When a user dies or is hospitalized, the care worker loses money.

No wonder so many quit after a few years. Young people who might be expected to pursue such a profession usually don’t. Right now, there are around 410,000 people certified as nursing-care specialists, but only 230,000 of them are active in the field. The majority of nursing-care workers have no special training. Increasingly, their ranks are made up of part-timers.

This means that skills are not developed and passed on, and thus quality of care deteriorates over time. But because of the way the system is structured, quality of care is not the bottom line. The bottom line is the bottom line.

Since the system started in 2000, the ratio of for-profit care providers to nonprofit care providers has gone up as more companies join the system and compete using aggressive sales tactics and their ability to diversify.

The government pays nursing-care providers about 6.7 trillion yen a year. This money comes from tax revenues and from mandatory kaigo premiums that are now paid by everyone over 40. Ninety percent of a user’s fee is paid for by the government and the rest by the user. This money goes to the nursing-care provider, which means that in order for a company to maximize profits and please its stockholders, it has to solicit users and then extract as much money as possible from each one. Care is categorized into five levels depending on need. Level 5 indicates the most intensive care, usually for bedridden users. The government pays up to 360,000 yen a month for level 5 care.

Nursing care companies make more money when the level of care is higher, and levels are determined by “care managers,” who often work for the companies. But even within each level there are optional fee-based services. Caregivers and home helpers are pressured to be salespeople, persuading users to request more services.

In April, the government revised the kaigo system, giving more money for higher-level care (i.e., for sicker people) and less for lower-level care, which mostly entails housekeeping. Usually, it is for elderly widowers who are not particularly ill but who have never had to cook and clean for themselves. Kaigo in this case amounts to government-subsidized maid service. However, as mentioned in a related article in Shukan Kinyobi, home helpers, usually housewives without any special training, are often the only daily contact that some elderly people have with the outside world. Their value goes beyond their utility as housekeepers.

Nevertheless, the revision has placed more pressure on companies to cut costs, and the first cost that gets cut is for personnel. Home helpers have suddenly found their wages reduced even more, and thus more have quit.

Not long after the kaigo system was started, nursing-care companies realized that the one-on-one model of home-visit nursing care limits profits, and so they built nursing homes where they can collect users in one place and thus rationalize personnel costs. Comsn built 60 throughout Japan. Because the companies can also charge rent and management fees, they can receive more money from the government per user than they can for home-care users. That’s why in late 2004, the health ministry instructed local governments, which supervise the kaigo system, to stop approving nursing home construction. It was obviously costing the central government too much money.

The Asahi series shows that the interaction between a public sector trying to slash expenses and a private sector trying to maximize profits has resulted in a nursing-care system that can’t fulfill its mission. Kinyobi says that social-security scholars predicted something like the Comsn scandal when the current system was proposed back in 1995. Both the government and corporations treat users and caregivers as numbers rather than as human beings. It’s not a question of fixing the system. The system can never work.