The cost of medical services are expected to grow sharply in the coming years with the accelerated aging of the nation’s population. The government is seeking to take steps to rein in medical expenses by 2025, when people 65 or older are projected to account for 30 percent of the total population and all of the postwar baby boomer generation will have turned 75 or older. The Health, Labor and Welfare Ministry’s recent release of a list of public hospitals deemed to be in need of consolidation and reorganization is a part of such efforts.

The health ministry put 424 municipality-run hospitals and other public institutions, including those run by the Japanese Red Cross Society, on the list — or nearly 30 percent of the 1,455 such institutions nationwide that it surveyed — based on such criteria as the number of cases handled or the presence of similar institutions in nearby areas. The ministry is requesting the municipalities and the institutions to weigh their consolidation and reorganization by September next year, although its call has no legally binding power.

Medical expenses continue to balloon as the elderly population keeps growing and requiring care, and reform of the medical service system is unavoidable to curb the rising costs. A majority of the municipality-run hospitals across Japan are believed to be operating in the red, and the fiscal burden of covering their losses with taxpayer money, to the tune of hundreds of billions of yen each year, weighs heavily on the local governments. The reorganization of inefficient institutions with sluggish records of medical service will be inevitable.

Such efforts, however, need to take into account the roles played by public hospitals that private institutions may not be expected to play, such as serving residents in remote areas or on small islands, as well as providing advanced treatment for cancer and other illnesses. The national government’s efforts thus far to promote the streamlining of medical institutions and hospital beds to get medical expenses under control have not made much progress as municipalities hesitate to take steps that prove unpopular among local residents.

Seeking to mechanically streamline public hospitals based on uniform standards may not move forward if the attempt fails to win support from the municipalities and their residents. To ease the anxieties of people afraid they may lose access to medical services in their communities, the efforts should consider the specific circumstances of each area served by the institutions deemed to require consolidation.

The government is seeking to promote the conversion of medical treatment functions in accordance with the demographic changes. With the rapid aging of the population and the shrinking ranks of younger generations, the need for “acute phase” medical care — in which intensive care is required following surgery for acute illnesses or serious injuries — declines since such care is often required for younger people, while demand for the “recovery phase” treatment for older patients’ rehabilitation and home care increases.

There will be an excess of hospital beds for acute phase care, while there already is a shortage of beds for recovery phase care. The conversion is aimed at resolving the mismatch of medical care needs and to curb overall expenses since acute phase care requires more staffing and is more costly. By reducing the capacity of hospital beds, the government hopes to promote home care of elderly patients and treatment at rehabilitation facilities.

The government has set a target of reducing the number of hospital beds nationwide from the current 1.24 million to 1.19 million. However, the efforts have not moved much forward. The health ministry naming the 424 public hospitals for possible consolidation and reorganization is aimed at prodding the municipalities and the medical institutions to take action. Whether it will have the intended effect remains to be seen.

Many of the hospitals placed on the list are small-scale institutions with relatively few beds. The institutions on the list accounted for around half of the public hospitals in prefectures like Niigata, Hokkaido and Miyagi. Many hospitals in rural areas are seeing the number of both inpatients and outpatients decline due to steep falls in the local population. But it is also said that such institutions even have trouble finding partners in nearby areas for consolidating their functions.

Concern lingers that streamlining the public hospitals that serve as a key infrastructure component for local residents would exacerbate the already serious shortage of doctors in the depopulated areas and could accelerate the outflow of residents even further. Such a concern needs to be addressed. It is an issue that municipalities and residents in those regions and areas should discuss on their own.

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