Healthcare: Japan's excellent system - but beware the free market

When I first arrived in Japan in 1950, it was not a very clean country. There was a lot of rubbish in the streets and people littered freely on the trains and buses. In the hospitals nursing care was limited, so in-patients were fed and washed by a relative or hired help, who slept on a futon on the floor next to the bed. Hygiene was not always up to par, especially at private clinics. I recall with revulsion the conditions at our local GP's consulting room in Nishinomiya near Osaka, where the floor was littered with the soiled bandages of numerous patients.

Half a century later Japan is exemplary for its spotless public spaces. The trains, town halls, schools and museums, not to mention the great department stores and shopping arcades - are all free from litter. Even the streets are clean and well-swept, with hardly a tossed beer can or dog's turd in sight. And this despite the scarcity of waste disposal facilities, most of which were removed after the Aum sarin gas attacks in the Tokyo subways in the mid-1990s, when rubbish bins were used to conceal their nefarious weapons.

Today's hospitals are especially praiseworthy for their high sanitary standards and efficient administration. Medical attention for both in- and outpatients is readily available - not counting the usual patience needed to await your turn - and judging by my recent, extensive experience in Tokyo, the quality of nursing care is equally commendable. Japan's healthcare system represents an enviable accomplishment of both professional organization and social discipline, evidently achieved during the post-war, democratic era - rather than being an aspect of traditional Japanese society.

Let the patient share the costs

Public hospitals and health clinics in the UK generally compare unfavourably with their Japanese counterparts. Under the National Health Service, surgery for serious medical problems can entail a wait of many months if the condition is considered not immediately life-threatening. An appointment with a specialist may take weeks to arrange. Those who can afford it visit a private consultant at a fee of seldom less than £100 (¥25,000) and frequently much more for a consultation, plus the related costs of lab tests and medicines. As for hygiene, that is generally acceptable, though I have seen some pretty filthy conditions in the back areas of a couple of major London hospitals that would be unthinkable in Japan today.

Why these differences between comparably wealthy countries? For one thing, the UK and other West-European countries, with their diverse populations from many ethnic and cultural backgrounds, cannot emulate Japan's relative uniformity of performance. Another aspect is the work ethic of public healthcare workers, which is clearly stronger in Japan than in most areas of Europe. But there are also financial reasons.

The British National Health Service (NHS) is funded from general taxation and essentially free to the user at the point of delivery regardless of income status, except for a small flat charge for prescription medicines. The Japanese National Health Insurance (NHI) is funded by insurance premiums paid by every citizen based on income. In addition, the user of NHI services pays 10%, 20% or 30% of the cost of each service performed, depending on income status. In spite of this co-payment, use of the system is heavy, with 16 average annual per capita doctor consultations (compared to an average of 6.6 for the 30 OECD member countries), and an average hospital stay of 31.5 days, by far the highest among OECD members, whose average is 8.2 days. This latter phenomenon is referred to as 'social hospitalization', a serious problem. So far the government has been able to fund the NHI budget, but an overhaul of the system may well become necessary.

I believe the principle of requiring the user to pay part of the cost of medical services is a sound one, better than the UK system, where everyone gets free healthcare, regardless of income, and the medical resources are seriously overburdened as a result.

Avoid privatization in the public sphere

In the case of public transport - the subject of last month's Shifting Society essay - Japan has proved that privatization does not need to cause a decline in the quality of the service delivered, as has been seen in a number of privatization cases in the U.K. Yet the spectre of profit considerations dominating decision-making in any privatized industry must not be lost sight of in considering alternatives to the present organization of the NHI. One shudders at the thought that Japan's NHI might one day be sold to private (foreign?) operators whose primary concern is not public health but 'shareholder value'.

Just how harmful such extreme market-driven policy can be was illustrated recently by a report on the overbooking strategy of USAir, a major regional American airline. The Washington Post wrote that the airline deliberately overbooks every flight, to ensure that every last seat is occupied. This means routinely bumping passengers with confirmed and paid-for reservations off the flight, on the excuse that they were 'late' for check-in. Passengers who make a big scene are escorted away by police. In one instance a screaming woman was strapped to a bench to restrain her. She was later found dead, choked by a chain stretched across her throat. USAir personnel loathe the overbooking policy, as they have to deal with the disgruntled passengers. The policy is clearly aimed at maximizing profit and thus 'shareholder value'. Of the airline's $11.56 billion in 2006 revenue, $1 billion was credited to determined overbooking.

Of course this is a particularly horrifying case, unimaginable in Japan. My point is that unrestrained market forces tend to favour the shareholder over the customer. Whatever the political or economic system, tight supervision over essential public services will always remain necessary.

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© 2007 Hans Brinckmann