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This is a small step toward maintaining the social security system in the face of a rapidly aging population. The government must continue to review the system so that all generations can feel secure.
A revised law on securing medical care for elderly people has been enacted, which will raise the percentage of the out-of-pocket medical expenses paid by people aged 75 or older from 10% to 20% for those with a certain level of income. The law will take effect in the second half of fiscal 2022 and be established through a government ordinance.
In 2022, the baby boomers will enter the age group of those 75 or older, and medical expenses are expected to increase further. It is necessary to change the basic structure of social security, in which benefits are centered on the elderly and the burden is shouldered mainly by working-age generations.
Currently, most of the elderly aged 75 or older pay 10% of the total cost for medical care out of their pockets. Only some people with high income pay 30%, the same as the working-age generations.
It is reasonable to require those with moderate incomes to pay 20% of the total cost with this legal revision. The government must carefully explain this matter to the public and seek their understanding.
The 20% out-of-pocket payment will be applied to people with such conditions as an annual income of ¥2 million or higher, including pension benefits, for single households or an annual income of ¥3.2 million, including pension benefits, for a couple in which both the husband and wife are aged 75 or older.
During Diet deliberations, concerns were expressed that some elderly people would become hesitant to receive medical services, possibly worsening their symptoms.
The government explained that it would implement measures to limit the increase in outpatient payments to ¥3,000 per month for the first three years after the revision takes effect. It is important to fully inform the public and alleviate the concerns of the elderly. Even after the introduction of the revised law, the government must make efforts to understand the actual situation, to see if there is any excessive reluctance to visit hospitals and clinics.
The purpose of the revision of the law is to reduce the burden on the working-age generations.
Except for out-of-pocket payments, public funds cover 50% of the medical expenses for elderly people aged 75 or older, while 40% comes from social insurance premiums paid by the working-age generations and the remaining 10% from insurance premiums paid by people aged 75 or older.
The burden of support on the working-age generations is heavy, and there have been notable cases in which the health insurance associations of employees at large companies were forced to dissolve because their financial situation deteriorated.
Even with the latest revision of the system, it will reduce support payments by just ¥72 billion in fiscal 2022, which translates to about only ¥700 per working-age person per year. This is far from enough for the working-age generations to feel a reduction in their burden.
Simply making a series of minor changes based on the premise of limited financial resources will not resolve the people’s concerns about the future. Partly to curb the rise in social insurance premiums, the government must consider raising the consumption tax rate, which is shouldered by wide range of generations.
The government should have more in-depth discussions on the proper state of social security and taxes, including pensions and nursing care.
— The original Japanese article appeared in The Yomiuri Shimbun on June 6, 2021.
