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As medical costs continue to grow, there is no way to avoid asking the elderly to bear a certain burden. The government needs to persistently call for understanding regarding the importance of revising the system.
Starting in October, the out-of-pocket payment for medical expenses was raised from 10% to 20% for elderly persons 75 or older with a certain level of income.
Those who will have to pay 20% include single-person households with at least ¥2 million in annual pension income, and married-couple households with a total income of at least ¥3.2 million if both are 75 or older. About 20%, or 3.7 million, of the people in Japan 75 or older will be subject to this change.
Elderly people with high incomes are still required to pay 30% of their medical costs, as are members of the working generations.
Medical expenses have been increasing year by year and totaled about ¥44 trillion in fiscal 2019, an increase of 120% from 30 years before. Members of the baby boomer generation will be at least 75 this year, and costs are expected to increase further.
The conventional social security system — in which benefits are paid mainly to the elderly and the working generations bear the majority of the burden — is reaching its limits. It is reasonable to ask elderly people who can pay their fair share to do so.
The revised system will reduce the burden on the working generation, though only slightly.
Of the portion not covered by an individual’s out-of-pocket payment, 50% of medical expenses for people 75 or older are covered by public funds, 40% is provided by the health insurance programs of the working generations, and the remaining 10% comes from the insurance premiums paid by people 75 or older.
After the reforms are implemented in October, support payments from the working generations will be reduced by about ¥700 per person per year.
Many members of the working generations are struggling with educational and housing expenses. Some are in low-paid, unstable, non-regular employment. The burden must be shared by a wide range of generations, including the elderly, to make the health care system more sustainable.
To ensure that the elderly, who now have to pay 20% of the total cost of their medical care, do not hesitate to visit a doctor, the government has introduced a measure to limit the monthly increase in the payments by elderly outpatients to a maximum of ¥3,000 for three years, until the end of September 2025. This measure must be well publicized to alleviate the concerns of those 75 or older.
Given Japan’s rapidly aging society and chronically low birth rate, further reforms are inevitable.
People 75 or older can currently be charged insurance premiums of no more than ¥660,000 per year. The government is considering raising this amount. If painful reforms are repeatedly implemented, there could be widespread opposition. This issue must be carefully debated, while assessing the impact of the latest revision of the system.
It is also important to create an environment in which the elderly can stay healthy for a long time. It is desirable for the government to focus on the prevention of lifestyle-related diseases and to encourage the creation of a sense of purpose in life, for example, by increasing work opportunities.
