Long-term care in Japan - statistics & facts

Nearly 35 percent of the general account expenditure of the Japanese government was allotted to social security expenses in 2019. This percentage is increasing due to the rapidly aging population of Japan. One in four Japanese citizens will be over 75 by 2025, consequently, spending on the pension system, healthcare, long-term care, and welfare will further surge.
The number of people requiring long-term care, for example, was close to 6.7 million in 2020, up from five million in 2011. This increase led to a budget leap of long-term care from 2.5 trillion to 3.6 trillion Japanese yen in the past decade. The total value of supplied benefits for long-term care grew from around 7.3 trillion in the fiscal year 2011 to almost 10 trillion yen in fiscal 2019. Thus, the demographic shifts in Japan will, on one hand, entail pressure on governmental spending but on the other hand, bring about significant growth for service providers and related industries.

Long term care insurance system

Long-term care services and benefits are distributed under the long-term care insurance (LTCI) system established in 2000. Half of the system’s budget is publicly funded by the central and local governments, while the other half is financed by the insurance premium. Every Japanese citizen above 40 years old must join the LTCI and pay these premiums. There are two categories, primary insured people aged 65 years and older and secondary insured people aged 40 to 64. Primary insured people are eligible to receive long-term care services with 70 to 90 percent of costs covered by the insurance depending on the income status. Secondary insured people can also access benefits when they suffer from disabilities caused by age-related illnesses such as cerebrovascular diseases.
Of the total primary insured people in the country, more than 18 percent required nursing care or support in 2020. To compensate for the growing number of people requiring care, the LTCI fees for both age cohorts have steadily risen over the last decade. As of 2021, primary insured people paid a monthly average of around six thousand yen for premium.

Available services and shortage of caregivers

Long-term care eligibility of primary insured people and the allocation of benefits are determined by the municipalities. There are seven care level categories from Support Level 1 -needing preventive care for long-term frailty - to Care Level 5 – assigned for bedridden conditions and neurodegenerative ailments. Services are divided into three categories, in-home care, care at nursing facilities, and community-based care. In-home care services are for recipients who live at home and receive services such as domestic help, bathing, and rehabilitation at home or day-care and short-stay facilities. Nursing institutions offer comprehensive services for in-house residents. Community-based care was established in 2006 to provide flexible services such as monthly flat-rate plans, in which local recipients can receive, for example, home-visit care with a night shift.
Generally, there is a shortage of both domestic and professional caregivers in Japan and the Japanese health ministry warned about this deficiency till 2025 and onward. A survey in 2020 revealed that the majority of households with care recipients were nuclear family or one-person households, indicating a high demand for external caregivers. The total number of certified care workers has significantly increased over the past decade.

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