The finance and health ministries are thinking of setting up funds in each prefecture to support private hospitals trying to rid themselves of excess beds that are driving up medical costs, it has been learned.

The idea calls for setting up a fund in each of the 47 prefectures to facilitate the realignment and integration of the nation’s hospitals, informed sources said.

Japan has too many hospital beds for its population, and that is believed to be a factor in the nation’s ballooning medical costs, experts said Thursday.

The cost of the funds would be covered by revenue from the Oct. 1 tax hike, which has completed the doubling of the consumption tax to 10 percent from 5 percent. Related expenses, which may reach several tens of billions of yen, would be included in the upcoming draft budget for fiscal 2020.

The funds would be part of the national “community health care vision,” which is aimed at reviewing the scale and function of hospitals across the country.

The funds would help the hospitals offset losses on past investments on condition that the beds to be scrapped continue to be utilized to some extent.

Japan has other funds for regional medical service reforms that were created in fiscal 2014. But these funds, present in all prefectures, are being used not only to cover bed reductions but other areas as well, including improvements to home-based medical care and elderly nursing care services.

The Japan Medical Association has requested that the existing funds be reviewed.

The community health care vision sets the number of hospital beds that will be considered appropriate in 2025, when all of the baby boomers will be 75 or older.

In September, the health ministry released a list of 424 public hospitals that may have to be scrapped or integrated with others.

In October, the Council on Economic and Fiscal Policy, a key government panel, suggested that Japan’s public and private hospitals had a combined 130,000 excess beds.

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