The Hatoyama administration has decided to raise remuneration to medical institutions for fiscal 2010 and 2011. Although the raise amounts to only 0.19 percent on average, significantly it is the first raise in 10 years. The decision came against the Finance Ministry’s demand that payments be lowered by about 3 percent. It is hoped that the decision will serve as the first meaningful step toward resuscitating the nation’s medical services, which are collapsing in some rural regions.

Every other year the Central Social Insurance Medical Council (Chuikyo) determines how much hospitals and clinics should be paid for medical treatments. Each of the past four remuneration reviews, under the Liberal Democratic Party-led government, resulted in decreased payments. The overall decrease during the period was near 8 percent. The last year that Chuikyo decided to raise remuneration was 2000, when it decided on a 0.2 percent increase.

Because of the decline in remuneration over the past decade, many hospital doctors, who often work under harsh conditions, have quit, and the resulting doctor shortages have forced many hospitals, especially in rural regions, to close emergency medicine, obstetric and pediatric departments. Such closures have caused inconvenience and worry for local residents.

Those doctors, nurses and others who provide medical services — who had hoped for a bigger increase in remuneration this time — may be disappointed by the 0.19 percent average raise. But financial difficulties faced by the administration should be taken into account.

Still, in fiscal 2010 the health ministry’s overall spending related to medical services will increase by 4.6 percent to about ¥9.404 trillion.

Remuneration is divided into a “main portion” for doctors’ expertise in medical treatment and for hospitalization fees, and a “drug fee” portion for drugs and medical supplies. Payments in the main portion will rise 1.55 percent, but payments in the drug fee portion will drop 1.36 percent due to falling drug prices.

Within the main portion, payments will rise by 1.74 percent for nondental medical services and by 2.09 percent for dental services. This means that payments for medical services will increase by about ¥570 billion. Of this amount, the health ministry plans to allocate some ¥400 billion for first-stage treatments of hospitalized patients in emergency medicine, obstetric and pediatric departments.

The ministry also plans to allocate some ¥40 billion to medical clinics that treat mainly outpatients, and some ¥60 billion to dental clinics. The planned boost in allocation for dental clinics is believed to be in response to the recent closure of many dental clinics. But it also appears to be a reward for the Japan Dental Association’s political arm, for its decision to not run its candidates on the Liberal Democratic Party ticket in the coming Upper House election.

Before the health ministry’s plan can materialize, Chuikyo must work out the finer details. As the plan shows, Chuikyo’s main goal is to allocate more money to hospitals.

A major issue during Chuikyo’s discussions will be possible changes to the followup examination fee system. The initial examination fee is now ¥2,700 at both hospitals and clinics, while the followup examination fee is higher at clinics (¥710) than at hospitals (¥600). The health ministry hopes to remove this inconsistency and have the cost of followup examinations become uniform at around ¥650.

The higher fee for followup examinations at clinics has been regarded as an indication of the relatively better economic situation of private practitioners compared with hospital doctors. A health ministry survey shows that on average, private practitioners earn about 1.7 times more than hospital doctors.

Health minister Akira Nagatsuma has removed three of the 20 Chuikyo members because they were linked to the 165,000-member Japan Medical Association. Although the JMA includes both private practitioners and hospital doctors, it has tended to emphasize the interests of private practitioners.

It is hoped that Chuikyo’s decisions will lead to higher wages for hospital doctors. Emergency medicine doctors, obstetricians and pediatricians face a high risk of malpractice lawsuits. They also work long hours due to personnel shortages. The departure of such professionals from hospitals because of inadequate wages further worsens existing shortages. Chuikyo also should not forget about private practitioners who make special efforts to improve the health of local residents.

The government should recognize the fact that raising remuneration will have only a limited effect with regard to preventing the collapse of medical services in rural regions. It should consider introducing a compulsory-service system in which doctors are assigned to rural regions and required to serve in their post for a set period of time.

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