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Hospitals in Japan - statistics & facts

Japan has one of the highest total numbers as well as density of hospitals in the world. In Japan, the term “hospitals” generally refers to health care facilities with more than 20 beds for patient admissions. Medical facilities with fewer beds or only outpatient services are classified as medical clinics. Hospitals in Japan fundamentally operate as non-profit organizations and are normally owned and managed by physicians. The Japanese government oversees and strictly regulates medical fees to keep treatments affordable for the public.

Health care system

Most Japanese citizens have public health insurance which covers a minimum of 70 percent of medical costs. Citizens pay between 10 and 30 percent of the medical fees depending on their income with the government subsidizing the remaining costs for low-income households. Japanese citizens can freely choose from any medical care institutions in the country for their treatments and services. Close to 70 percent of the hospitals in Japan are private and governed by medical corporations. Japan’s care system is therefore unique because on one hand it is publicly financed, and the fees are heavily regulated. On the other hand, hospitals are mainly privately owned and need to ‘compete’ for patients to financially break even or make a profit to survive long term.

Labor shortage

Japan is continuously facing a shortage of qualified medical personnel, leading to a severe workload for hospital staff. Due to the aging demographic and projected increase in hospital admissions, this labor shortage is expected to further progress in the coming decade. The Japanese government has been promoting community-based health care as a possible solution. The general intention is that various types of medical facilities form community health information networks to collaborate and share the treatment of patients nationwide. The government also proposed an expansion in the use of artificial intelligence (AI), big data, and medical robots.

Financial pressure on hospitals

The current financial status of hospitals in Japan is precarious, as revealed in surveys conducted in 2019. Close to 43 percent of hospitals experienced a loss of operating income for the fiscal year 2018. Cases of hospitals that went bankrupt were reported throughout the last decade. The annual medical care expenditure of the nation per capita, nevertheless, has shown an upward trend in recent years, reaching around 343 thousand Japanese yen in the fiscal year 2018. The coronavirus disease outbreak (COVID-19) had an additional negative financial impact on Japanese hospitals. The medical practice income of hospitals that accepted COVID-19 patients declined in the fiscal year 2020 by nearly five percent compared to the previous fiscal year.

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