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How Japan has reformed the way it looks after older people

How Japan has reformed the way it looks after older peopleI recently read an article in Nature Outlook on aging by Benjamin Plackett in which he provides interesting information on how Japan is tackling the worldwide problem of caring for older people.

The role of women in Japan’s workforce

Neglecting half a country’s workforce in favour of at-home care is a serious drag on the economy, which is why Japan has reformed the way it looks after its older people. Japan has a lower internal migration rate than many other counties, with 20% of people not living in the prefecture where they were born, but it used to share the issue of relatively few women working in the formal economy. In 2000, 67% of Japan’s women between the ages of 25 and 54 were officially employed — 10 percentage points below the United States. Japan was also faced with a dwindling workforce in general.

“Lots of women were saying it wasn’t fair,” says Natasha Curry, deputy director of policy at the Nuffield Trust health think tank in London, who co-authored a 2018 policy review on what England can learn from Japan’s system of long-term care.

At the start of the millennium, Japan launched its Long-Term Care Insurance (LTCI) scheme with the aim of shifting care away from the family-dominated system.to an insurance-based one.

Similarities between the Japan and the UK

“Demographically, the UK is about 20 years behind Japan and so is its care system,” says Curry. “We’re in a different place with more women working, but we definitely have some similarities with Japan in 2000.”

Under the LTCI, everyone older than 65 who needs care for any reason is offered support — they don’t need to have a significant disability. Entitlement is initially determined by a survey followed by input from a medical doctor and a decision from the long-term care approval board. The claimant is then assigned a level of care specific to their individual requirements, ranging from nursing-home residence to welfare visits at home to help with day-to-day tasks such as bathing.

The LTCI is paid for by a 50/50 mixture of tax revenue and mandatory insurance premiums for the over 40s. “This age threshold was chosen specifically because you probably have an elderly relative in need of care by the time you reach 40, so you can appreciate the benefit of such a system,” says Curry. The budget is topped up by those receiving care, who are required to pay 10% of the costs.

Preventive care services

If the approval board decides that someone does not need long-term care, they might be offered ‘preventive care services’, which can include rehabilitation and physiotherapy. Prevention is important because the LTCI has become a victim of its own success. Enrolment in the scheme has skyrocketed since it was first introduced. In 2000, the Japanese government spent roughly ¥3.6 trillion (US$32 billion) on LTCI payments. By 2017, that figure had swelled to ¥10.7 trillion, and models forecast it could be close to ¥15 trillion by 2025.

To help control the cost, the government watered down some of the benefits in 2005, requiring contributions to meal costs. It also introduced a higher 20% co-payment fee in 2015 for wealthier people. The government also tried to lower the age of premium contributions from 40 to 20, but that was met with large-scale opposition, largely from employers who also contribute to the scheme.

The lesson here is that the cost of a scheme that is as comprehensive as Japan’s is liable to increase. But the high level of enthusiasm for the LTCI didn’t come easily, says Curry. It required a major change in public opinion because there was a feeling of shame in not looking after older relatives. “They designed the system to be quite generous, so the benefits were obvious,” she adds. “I think this made people realise that old people weren’t being given a substandard system.”

People not given cash but provided with a budget

The government also ensures that individuals are not given cash but are instead allotted a budget that goes directly to the professional care establishment of their choice. This stops people taking their allowance but remaining in the sole care of their family.

Is it a success

Many of the problems that Japan sought to offset with the LTCI are still there, but they have abated since the system was introduced. Japan’s working-age population shrank by more than 11 million people between 2000 and 2018, but the workforce increased by 600,000. This rise is attributed to increased numbers of women in the workplace — possibly because the LTCI reduced their family care concerns and so levelled the playing field. It did achieve one objective to shift this burden of care.

Summary

It is difficult to quality the similarities of Japan and the UK given the different political and cultural entities. Putting that to one side, the UK Government seem to have followed Japan’s lead on the introduction of a long-term care insurance scheme and the concept of funding care planning packages. It remains to be seen whether or not the UK is as generous as Japan with the funding of social care in the future.

Albert Cook BA, MA & Fellow Charted Quality Institute Managing Director Bettal Quality Consultancy

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