Public Health Insurance in Japan

Japanese universal public health insurance which is largely based on a fee-for-services payment system has functioned well so far. There are several key factors for the success of this program such as social solidarity and infrastructure for the utilization review. However, people's demand on health services has increased over the years and as a result, reform in under way to provide more diversified and quality-oriented health services. The centralized system is viewed as less suitable for coping with these more recent issues related to the quality of health care. While the private sector has established an important infrastructure that delivers health services and maintains public health, its role is relatively small in terms of health service financing. Going forward, two major challenges remain. They are: (i) to provide the elderly population with adequate health, nursing, and long-term care services at an affordable cost, and (ii) to reduce regional differences in health care expenditure. The World Bank enjoys copyright under protocol 2 of the Universal Copyright Convention. This material may nonetheless be copied for research, educational, or scholarly purposes only in the member countries of The World Bank. Material in this series is subject to revision. The findings, interpretations, and conclusions expressed in this document are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations, or the members of its Board of Executive Directors or the countries they represent.