Insights Into The World

Long-term Care Insurance Increasingly Insecure

By Tadao Kakizoe / Special to The Yomiuri Shimbun

9:30 JST, August 11, 2023

Japan’s long-term care insurance system, introduced in April 2000, is an extremely important social welfare program that supports elderly people with dementia or physical impairments.

However, it is now facing increasingly serious challenges due to the rapid increase in the population of elderly people and the shortage of nursing care workers.

Upon reaching the age of 40, people living in Japan are obliged to join the long-term care insurance system, with nursing care insurance premiums collected together with health insurance premiums until they turn 64. In the case of people aged 65 or older, nursing care insurance premiums are deducted from their pension benefits as a basic rule. In short, the system can be described as a framework through which all of Japanese society supports nursing care services for the elderly.

Elderly people with mental or physical disorders who are certified as needing long-term care services covered by insurance can obtain these services by paying 10% of the usage fees, in principle. Higher income earners pay 20% or 30%. The long-term care insurance system has thus helped reduce the number of “kaigo nanmin,” literally “nursing care refugees,” who cannot afford to access care services for economic or other reasons.

The continuation of this indispensable system is in danger.

The biggest challenge facing Japan with regard to long-term care insurance is how to cope with the rapid increase in the number of people in need of nursing care services, caused by the accelerated graying of the population.

According to the health ministry, 6.69 million people were certified as needing long-term care and support as of the end of March 2020, an increase of about 2.6 times over the preceding 20 years or so.

In Japan, people aged 65 or older accounted for 28.6% of the overall population as of 2020, far above the 21.7% for Germany, 18.7% for the United Kingdom and 16.6% for the United States. What’s more, Japan’s population is projected to keep graying over the next nearly 20 years.

Fiscal constraints

The rise in the number of elderly people is increasing the strain on the fiscal resources for social security spending that support Japan’s long-term care insurance system.

Social security benefits for fiscal 2023 amount to ¥134 trillion on a budgetary basis, including ¥60 trillion in pension benefits, ¥42 trillion in medical care benefits, ¥14 trillion in nursing care benefits and ¥10 trillion in child allowances and child care benefits. The government expects the overall benefits to be financed by ¥78 trillion worth of related insurance premiums in the fiscal year and ¥53 trillion from public funds.

The projected sum of public money cannot be covered just by tax revenues. As a result, a huge amount of deficit-financing government bonds needs to be issued, which will leave future generations in Japan in debt.

In 2025, post-World War II baby boomers will all be 75 or older, putting them among the so-called late-stage elderly. Official data for 2019 showed that nursing care costs totaled an average of about ¥50,000 per person for early-stage elderly aged 65 to 74. The comparable sum jumped to about ¥470,000 for people aged 75 or older. As the population of late-stage elderly is destined to steeply rise soon, Japan’s fiscal system will come under increased pressure.

The second challenge is how to secure enough nursing care workers. The country is projected to need 2.43 million workers in the nursing care sector in fiscal 2025, but the sector’s fiscal 2019 labor force was 320,000 workers short of that figure. Given the relatively low wages in the nursing care profession, it will be difficult to secure the projected number of personnel.

To overcome these challenges, including the deterioration of fiscal resources, the long-term care insurance system will inevitably have to undergo systemic reforms, including increasing insurance enrollees’ co-payments. I also want to touch on three approaches, based on my many years of experience as a doctor, for dealing with difficult situations.

First, people should try to prolong their healthy life expectancy — the state of living in good health — as much as possible.

Healthy life expectancy is the average number of years people are expected to live without the support of nursing care services. In 2019, the number of healthy life years from birth was 75.38 years for women and 72.68 years for men in Japan. The country’s life expectancy at birth — which does not take health status into account — stood at 87.45 years for women and 81.41 years for men. This means women would need nursing care for about 12 years and men for about nine years, on average. Relying on nursing care for about 10 years would not only cause people anguish but also deal a severe blow to the country’s fiscal structure.

Healthy life expectancy can be prolonged through individual effort. The key point is to maintain muscle strength, especially in the lower limbs. I want people who can walk to make it a daily habit.

Furthermore, it is important to develop the muscles of the tibialis anterior, which runs down the front of the shin and connects to the inner side of the foot. When this muscle weakens, the toes tend to go down while walking, making people highly prone to tripping and falling even on a slight step. In fact, this kind of fall is known to be the most common cause of household injuries, including bone fractures.

When people become bedridden or unable to move freely due to broken bones, their muscle strength declines, making it more difficult to move. This situation raises the risk of dementia. I want elderly people to build up their tibialis anterior muscles by doing exercises, such as raising their toes every day while holding onto the back of a chair.

Foreign caregivers

The second issue is how to solve the chronic labor shortage in the nursing care sector.

The long-term care fee schedule is reviewed every three years in principle, with the next review scheduled for fiscal 2024. Wages for nursing care professionals should be improved within the range possible, to make the profession sufficiently attractive.

Utilizing foreign workers in nursing care services is a major issue to be addressed further by Japanese society. Since as early as fiscal 2008, the government has accepted candidates for nurses and certified care workers from Indonesia, the Philippines and Vietnam based on bilateral economic partnership agreements with them. But the number of candidates who obtain Japan’s national qualifications for these jobs remains small because of the language barrier.

Prior to the acceptance of candidates for nurses and certified care workers, Japan launched the so-called technical intern training program for foreign trainees in 1993. The original purpose of the program was to enhance Japan’s international contributions by transferring technology and knowledge to developing countries through the development of human resources. However, it cannot be denied that the program has been abused as a means to secure cheap labor. The consequences have become clear of accepting foreign trainees little by little based on the training program without giving due consideration to their status and rights in Japan.

People in developing countries who want to work overseas are increasingly inclined to choose Germany or Sweden as their possible destination, as the two European countries are well-known for robust measures to protect workers. Japan is emerging as “a country to which foreign workers no longer give a thumbs-up.” If Japan fails to turn its nursing care workplace into a worthwhile one, it will be difficult to expect an increase in foreign nursing care workers.

The third issue is efforts to fully utilize new technologies, including artificial intelligence analytics of big data gathered in nursing care workplaces, to develop novel long-term care solutions.

Individual health and medical information, called personal health records, or PHRs, which include such data as heart rate and body temperature, can be compiled via smartphone apps or other mobile devices. Each PHR contains information about chronic illnesses and data on exercise, including the number of steps in each daily walking session. Some health nurses are already taking advantage of PHR data to provide tailor-made exercise and dietary advisory packages to help prevent their clients from becoming bedridden.

Beds with pressure sensors are in practical use at nursing care facilities, enabling caregivers in staff rooms to monitor how well elderly residents in the facilities are sleeping and to be instantly alerted when a resident wakes up and leaves bed.

In the future, nursing care staffers may wear smart glasses with built-in equipment that can record audio and video of their conversations with nursing care recipients, and keep track of the care services provided to them. Such a system might make it possible to analyze digital data to assess whether each caregiver has provided adequate care.

When science and technology are properly utilized, it may be possible to optimize nursing care services and alleviate the burdens on caregivers.

I hope this kind of three-way approach will be adopted and positive results will be achieved, which may help secure enough personnel in the nursing care sector and mitigate their burden in the workplace.

Anyone might become a recipient of nursing care. I hope that everyone thinks of the future of long-term care insurance as a personal issue.