Japanese Health Care: Low Cost Through Regulated Fees

Abstract

Prologue: Japans health care system represents an enigma for Americans. The system incorporates features that Americans value highly: employment-based health insurance, free consumer choice of physician, and a delivery system that leaves clinical decision making in the hands of the doctor. But the cost of medical care in Japan is very low, compared with that in the United States, thus raising the question: How does Japan provide ready access to care for all of its citizens at a cost that is the lowest among major industrialized nations? In this essay, Naoki Ikegami describes the basic structure of the Japanese system, how it constrains expenditures, and the major issues it faces. Ikegami is a rare figure in the Japanese system because his interests span clinical medicine and health policy—a combination that is far more commonly found in the United States. Ikegami, who trained as a psychiatrist and started his research activities on the epidemiology of alcoholism, is a professor of health and public service management at Keio University in Tokyo. He also holds an appointment as professor of hospital and medical administration in Keio's School of Medicine, from which he received his medical degree. Ikegami received a master of arts degree in health services studies with distinction from Leeds University (United Kingdom). During 1990-1991, Ikegami was a visiting professor at the University of Pennsylvania's schools of medicine and business. Asked what lessons he derived from the experience, Ikegami said it allowed time “to ponder the pros and cons of opening the Pandora's box of managed care and micro-management in trying to evaluate the quality of care.” While at Penn, Ikegami also strengthened his research interests in the comparative analysis of policy and management in health care. He was the director of a course in comparative health care systems at Penn. Other research pursuits have included the management of long-term care and the evaluation of health care.