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The working-age population, which supports the medical care system for elderly people age 75 and older, is under a heavy burden. It is important for the government to carefully explain this to the elderly and ask for their cooperation in bearing more of the burden.
A revised Health Insurance Law has been enacted. The main pillar of the revision is to raise insurance premiums for the system, which covers people who are 75 and older.
Medical expenses for the elderly account for nearly 40% of overall annual medical expenses, which total ¥44 trillion. The “baby boomers” born after World War II have been reaching 75, and by 2025 all of them will have joined the medical care system for this age group.
Medical expenses are expected to continue to increase. Constant reforms are essential to make the system sustainable.
The revised law will gradually raise insurance premiums for those age 75 and over. In fiscal 2024, the revision will cover people with an annual pension income exceeding ¥2.11 million and expand to those with one exceeding ¥1.53 million in fiscal 2025 and beyond.
According to a Health, Labor and Welfare Ministry estimate, for a person with an income of ¥2 million per year, including their pension, the premium will increase by ¥3,900 per year.
This is a major revision that will affect 40% of those age 75 and older. In order to ensure a smooth introduction, it will be important to gain the understanding of elderly people.
The medical care system specifically designed for elderly people 75 and older began in 2008, and it is 50% funded by public funds, 40% by support from the working-age population and 10% by the insurance premiums of the elderly. Compared to the initial situation, the burden per elderly person has increased by 20%, while that per person of working age has increased by 70%.
It is an important role of a public medical insurance program that the younger generations support elderly people, who are prone to illness. Nevertheless, if the burden on the working-age population becomes too heavy, the sense of intergenerational inequity may be amplified. It is unavoidable to ask the elderly, who have a certain income, to bear the burden.
However, as food prices and utility costs rise, the increased health insurance premiums are a heavy burden for elderly households. The government should consider taking measures, if necessary, against soaring prices.
In addition to increasing the burden, controlling the growth of medical expenses is also an important issue. The government should strengthen its efforts to eliminate wasteful practices such as the administration of duplicate drugs with the same effects to elderly people and encourage the use of inexpensive generic drugs.
The revised law also includes a mechanism to share funding for the lump-sum childbirth and child-rearing allowances provided to those who have a newborn child with the medical care system for the elderly. This is an embodiment of the concept of a “social security system supported by all generations” in which a wide range of generations support each other.
While it is necessary to allocate social insurance premiums to finance measures to combat the declining birth rate, these alone will not be enough to cover the costs. Discussion should be deepened on this issue, including how to involve the taxation system.
