To the Editor: The long-term care insurance (LTCI) law that was enacted in Japan in 2000 has brought major changes to the care system for older people. As a result, there has been a shift in the financial source for social care services, from tax based to LTCI based to ensure a stable financial basis for the increasing numbers of impaired elderly persons who need long-term care services. A contract-based system of service that ensures users' “freedom of choice” has replaced the former municipal decision system that did not allow individual choice. Moreover, with certain exceptions, care management has been formally established as a system paid for with care service fees. This ensures the provision of appropriate services with individual care planning and facilitates the use of the services by elderly persons in need. Below, the challenges faced by the LTCI system in Japan are discussed by focusing on care management. A new qualification for care managers was introduced in Japan. By 2004, approximately 340,000 people in various care professions had been trained as care managers (Table 1).1, 2 More than half of these care managers were nurses and certified care workers, but there was also a high proportion of physicians and other medical professionals such as pharmacists. Qualification as a care manager requires at least 5 years of work experience, passing an examination, and the completion of a preservice training course. The qualification system leaves much to be desired, because neither the specified work experience related to elderly care nor the length of training (approximately 35 hours) is sufficient. The professional diversity of care managers might have been due to the huge demand for managers at the time of enactment of the LTCI system and to business opportunities in related professions. The government is now taking steps to improve the quality of care managers by introducing successive in-service training schemes, by introducing a grade of “supervisory care manager” for highly skilled managers, and by renewing care managers' qualification every 5 years.3 The LTCI system allows profit-making companies to provide care services, and care managers can be employed by them. Another characteristic of the LTCI system is that the care management fee is low; the monthly unit cost paid by insurers is ¥8,500 (approximately $77; $1=¥110) per service user. The care management fee is too low to compensate for the high workload of care managers.4 To provide appropriate care management services, it has been recommended that the care management fee be increased 50% to 100%.5 Finally, care managers take part not only in the assessment for care planning but also in the appraisal of care eligibility for insurance payment. A system with the characteristics described above is open to abuses by care managers employed by profit-making companies. There is also a growing concern that care managers could encourage users to receive unnecessary services, purchased preferably from their own companies, and manipulate the care eligibility appraisal with the intent to increase benefits, although such abuses are considered to be the exception, as attested to by the fact that insurers conduct the audit and that the average service use only reaches approximately half the upper limit of benefits allowed for total care services.6 One of the advantages of care management is considered to be “a clear division of responsibility between assessment/care management and service provision, separating the interest of service users and providers.”7 The LTCI system in Japan has no clear division between care management and service provision; it was designed based on the assumption that care service providers would simultaneously function as care management providers. This was expected to reduce care management fees but at the cost of forcing care managers into a conflict of interests with users and providers. Issues outlined above underline the inevitable consequences of the structural fragility of the care system in Japan. The LTCI system is due to be substantially revised in April 2006. At that time, the major focus is expected to be on financial reconstruction of the insurance system with the introduction of preventive care programs (kaigo-yobou). Separation of responsibility for care management from that of service provision is also due to be on the agenda. It is undoubtedly an important milestone that Japanese society has approved a contract-based system of care management and service provision. In the near future, care management will be made available for handicapped persons, in addition to elderly people. It is hoped that this will lead to improvements in the social service system in Japan well into the 21st century. Financial Disclosure: None of the authors received any financial support related to this letter. Author Contributions: Kazunori Kikuchi: data analysis and description. Ryutaro Takahashi, Yoko Sugihara, and Yumi Inagi: interpretation of data. Sponsors' Role: None.