Key messages
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Japan achieved universal health coverage in 1961, almost 40 years after social health insurance was first legislated in 1922. Coverage was expanded by establishment of employee-based and community-based plans, of which there are now about 3500. Dependants are covered by the plan of the head of the household.
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The services covered and the fees set for physicians and hospitals have been uniform across the nation since 1959, when community-based plans adopted the fee schedule of employee-based plans. Regulation of price has been the key mechanism for maintenance of equity and containment of costs.
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Although almost everyone became insured in 1961, the co-payment rate differed greatly: individuals with employee-based plans paid only a token amount for the first physician visit, but all others had to pay 50% of the fee schedule price. Since then, the rate has gradually decreased for those on community-based plans, and has gradually increased for employees. Nowadays everyone, except for elderly people and children, pays 30%. However, when the monthly co-payment exceeds a threshold amount, the co-payment is decreased to 1%.
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The greatest inequity is in the proportion of income levied as premiums. Although plans insuring people with low incomes are mitigated by subsidies from general revenues, and cross-subsidisation is enforced among plans to pay for the health-care costs of elderly people, there exists more than a three-times difference in the proportion of income paid as premiums across different plans.
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The sustainability of social health insurance is threatened by the increasing disparity in income and age composition among the plans, as a result of the ageing of society and changes in employment patterns. We advocate consolidation of all plans within prefectures to meet this challenge.
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Countries seeking to achieve universal health coverage through social health insurance based on employment and residential status should be aware of the limitations of this approach and address its weaknesses before opposition to structural reform becomes entrenched.