GLOCOM Platform
debates Media Reviews Tech Reviews Special Topics Books & Journals
Summary Page
Search with Google
Home > Media Reviews > News Review Last Updated: 14:54 03/09/2007
News Review #317: October 20, 2005

Japan to Cut Medical Insurance for Elderly to Reduce Costs

Reviewed by Hitoshi URABE

Japan to Cut Medical Insurance for Elderly to Reduce Costs


The article reports that Japan's government has announced plans to reduce medical insurance coverage for some elderly citizens to curb ballooning costs

It is simple arithmetic to see that if a society's birthrate were declining, the proportion of the elderly would increase. In case of Japan, the issue is significantly amplified by the shape of the demography. The number of people in late fifties is twice that of the similar age span of people in late teens or younger.

Already, 20% of the population is over the age of 65 - that is one out of every five people. According to the studies, including the government's official forecast, the share of the elderly keeps on growing until 2050 when more than a third of the whole population would be over 65.

The issue has been, and inevitably will continue to be, discussed in various ways. In fact, there have been quite a number of suggestions and opinions made. But most of them and were based on macroeconomics or broad sociology such as long term immigration or tax policies, and so there was certain sense remoteness for individuals as their specific effects on the daily lives were not easy to envision.

One of the obvious and most serious concerns of an individual, especially when they age, is health. While it is possible to an extent to plan for sustaining livelihood after becoming old, it is difficult to assess the appropriate level of reserves necessary for medical expenses as they vary greatly among each person, and it could get very expensive to the extent preparing for such a possibility could only hinder normal activities. This is where the medical insurance comes in, in order to maintain a healthy society by way of mutually dampening medical payments borne by individuals. Japan has maintained an elaborate system of government run medical insurance system which has reached the stage where no one thinks it could be maintained much longer - if not already collapsed in terms of sound accounting.

Younger people also get sick but less frequently. And even when they need medical care, symptoms are generally less severe, recovery more quickly, and have chances to repay the cost in various ways upon recovery. Aged people in each respective case as well as collectively need enhanced medical services both in terms of quality and quantity, and how it should be funded, while maintaining a healthy social framework, is the issue here.

It seems, however, there is no magic formula. The elderly have been treated preferentially in the past for various reasons, including the assumption that they have little income. But the circumstances no longer allow for special status to be provided for the elderly. In fact, statistics show that a huge chunk of savings are held by the aged people, while the young, working hard to run the society, are having difficulty building up their wealth. While it is necessary to sustain a safety net for those really in need, it has become more than ever equitable to share similar levels of financial burden based on the services received. Keeping the sense of fairness among members of a society is a vital element in maintaining a healthy society. Japan is no exception. It is necessary to seek a solution so as to avoid (another) potential generation clash, a grave possibility having its roots in the aging population and the decreasing birth rate.

bullet Top
Copyright © Japanese Institute of Global Communications