National / Science & Health

Japanese hospitals faced financial difficulties in fiscal 2018, survey finds

Kyodo

Hospitals faced continuing financial difficulties in fiscal 2018, with institutions across the country registering a minus 2.7 percent profit margin on average, a government survey has shown.

The negative profit margin for hospitals with 20 or more beds was 0.3 percentage point better than in the previous year, while clinics with up to 19 beds remained in the black, according to a biennial health ministry survey released Wednesday.

Profit margins of health clinics, dental clinics and pharmacies stood at 12.9 percent, 20.5 percent, and 5.5 percent, respectively.

The results of the survey by the Health, Labor and Welfare Ministry will be used to determine the size of medical service payments for health institutions under the public social insurance system. The fees will be reviewed in April.

In the year through March, about ¥42.6 trillion ($390 billion) in total was paid to health care institutions in the country.

Among hospitals, public institutions struggled in particular, with those run by local governments incurring a negative profit margin of 13.2 percent. National hospitals logged negative 2.3 percent.

Private hospitals were in the black with a profit margin of 0.9 percent, with their directors earning about ¥30.42 million annually on average, down 0.5 percent from fiscal 2017.

Heads of clinics earned about ¥28.07 million annually on average, while doctors at private hospitals earned about ¥16.41 million per year, according to the survey.

Medical service fees are funded by taxes, insurance premiums and out-of-pocket payments by patients, and increased service fees lead to inflated medical spending and a heavier contribution burden.