Aging In Japan - Focusing on Long-Term Care Insurance
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  • 1. Aging in Japan- Focusing on Long-Term Care Insurance Presented at “Healthy Aging Summit” April 12th, 2011 Los Angeles, CA Taichi ONOProfessor, Graduate School of Public Policy University of Tokyo 1
  • 2. IntroductionEducationMarch, 1989: B. of Laws, University of Tokyo May, 1994: MBA, University of California at BerkeleyJob HistoryApril, 1989 April, 2004 Entered Ministry of Health and Welfare(MHW) Director, Long-term Care Insurance Div., Hyogo Bureau for the Health and Welfare of the Elderly, Prefectural GovernmentMinister’s Secretariat (MS), MHW April, 2006July, 1992 Director for Food Safety, Pharmaceutical and University of California at Berkeley Food Safety Bureau, MHLWJuly, 1994 August, 2006 Chief, Policy Analysis Div., MS, MHW Director for Nurse Personnel Policy, HealthAugust, 1996 Services Bureau, MHLW Assistant Director, Nature Conservation July, 2008 Bureau, Environment Agency Director for Health Economics, Health InsuranceJuly, 1998 Bureau, MHLW Assistant Director, International Affairs Div., July, 2009MS, MHW Senior Policy Researcher (Chief Editor of theJune, 1999 White Paper on Health, Labour and Welfare), Office First Secretary, Embassy of Japan, USA of the Counsellor for Policy Evaluation, MHLWSeptember, 2002 April, 2010 Deputy Director, Food Safety Bureau, Ministry Professor, GraSPP, University of Tokyoof Health, Labour and Welfare (MHLW)September, 2003 Deputy Director, Health Insurance Bureau,MHLW 2
  • 3. IntroductionIn my presentation, “social security” refers tovarious policy areas of health and welfare, suchas public health, income security, social welfareservices, medical insurance, public pension,etc.. 3
  • 4. Outline1. Demography and Socio-Economic Situation of Japanese Elderly2. Development of Japanese Social Security System --- Development under so-called “ 1955 Regime”3. Outline and Challenges of Long-Term Care Insurance System (1) Outline of the System (2) Development of ”Comprehensive Community Care” (3) Sustainability4. Conclusion 4
  • 5. 1.Demography and Socio-Economic Situation of Japanese Elderly 5
  • 6. Life expectancy at Demography birth:Male: 79.59Female: 86.44Already the“Front Runner”of Aging Globe 6
  • 7. “Speed” of aging is another concern for policy making Demography4035 % of population aged 65 and over (actual figure and estimates)3025201510 Japan United States of 5 America 0 7
  • 8. Population is already Demography starting to decrease 8
  • 9. Demography 9
  • 10. DemographyGender difference widensfrom age 70s. 10
  • 11. DemographyDue to the longer life-expectancy, elderly needing long-term careincreases. 11
  • 12. Living arrangementsElderly who lives alone increase; supporting function of the families weakened. 12
  • 13. Living arrangements Still, family members are the primary caregivers. Caregivers themselves are aged; half of them are over 60 years old.In addition to the services provided publicly, support to various needs in daily life by mutual-aid community groups such as volunteers, NPOs or traditional citizenship groups areexpected. Mere greeting, or even paying attention by the neighbor will be of great help. 13 13
  • 14. Living arrangementsSpeed of aging is more rapid in urban areas in coming years.Over 65 population will increase in Over 75 population will increase inany prefecture until 2020, then any prefecture until 2030, thendecrease in some prefectures. decrease in some prefectures.Saitama, Chiba, Kanagawa and Saitama, Chiba, and Kanagawa willOkinawa will increase its over 65 increase its over 75 population 150%population 75% or more between or more between 2005 to 2035.2005 to 2035. Tokyo, Aichi and Ibaraki, Tokyo, Aichi, Shiga, Osaka,Shiga, the figure is about 50%. and Okinawa, the figure is about 100%. Growth rate of the aged (65 and over) Growth rate of the “old-old” (75 and over) 14
  • 15. Living arrangementsMany elderly live in their empty-nested homein the suburban areas. < Policy alternatives to be sought> - Promote to provide appropriate style of housing for the elderly (“senior residents with care/guardian services”) - Establish the network of in-home services within the community so as to support the independent life of frail elderly in need of care 15
  • 16. Average per capita income of the elderly is not so Economic Statusdifferent compared to the younger generation. 16
  • 17. Economic Status Their main source of income is public pension. Change of “Gini-Coefficient” by income redistribution (per person, age), 2008The public pension Equivalent income (before redistribution)and other social Equivalent income (after redistribution)security systemwork to reducedistributionalinequality amongthe elderly. 17
  • 18. 2. Development of Japanese Social Security System --- Development under so-called “ 1955 Regime” 18
  • 19. Development of Social Security System 19
  • 20. Development of Social Security System Post-WWII Period Legislative History※National Health Insurance Law (1938)、Labour Pension Insurance Law (1941)Post-war emergent relief and theestablishment of basic laws (1945-55)1947 : Child Welfare Law, Labor Standard Law, Workers’ Compensation Law, Employment Security Law,Unemployment Insurance Law1948: Medical Services Law, Medical Practitioner Law, Health Nurse, Midwife and Nurse Law1949: Handicapped Welfare LawUniversal Health Care and Pension, Progress of the Social Security (1955-early 1970’s)1958: Amendment of National Health Insurance Law (Universal Health Care)1959: National Pension Law (Universal Pension) (*Universal Health Care and Pension stated in 1961)1967: Establishment of Childcare Allowance(1973: Copayment abolished for elderly’s healthcare)Sustainability of the system(late 70–80’s) 1982: Re-introduction of copayment for elderly’s healthcare 1984: Amendement of Health Insurance Law (10% copayment for enrollee) 1985:Reform of pension system (Introduction of the Basic Pension) 1985: Equal Employment Opportunity Law for Men and Women 20
  • 21. Development of Social Security System Post-WWII Period Legislative HistoryEstablishment of the system accommodating withpopulation change (1990’s - current)1989: “Gold Plan” (Ten-year strategy to promote the health and welfare of the elderly)1994: “New Gold Plan”, “Angel Plan”1997: Long-term Care Insurance Law (enforced in April, 2000)2002: Amendment of Health Insurance Law (30% copayment for enrollee)2005: 1st major reform of the Long-term Care Insurance Law (enforced in April, 2006)2006: Reform of Health care supply and finance system (Establishment of the health finance system forthe “Old-Old”)Re-establishment of the social safety net responding to the labor marketchange and change in the family structure (Currently)2010: New (tax-based) Childcare Allowance Law2011: (On Schedule) 2nd major reform of the Long-term Care Insurance Law 21
  • 22. Development of Social Security System Post-War Period Development of Social Security System Post-war Universal Health Pursuing Establishment of the emergent Care and Pension, sustainability system accommodating relief and the Progress of the of the system Social Security with population change establishment (1955-early (late 70–80’s) (1990’s - current) of basic laws 1970’s) (1945-55) ・Changing economic environment ・Post-War confusion ・Rapid economic ・Transition to ・Population aging with less growth and higher stable economic children ・Emergent relief for standard of living growth poor and needy ・Universalization of social services (Helping the poor) ・Establishment of ・Rectification of ・Measures for the basic social security social security ・Privatization returnees system benefit simultaneous ・Localization ・Social insurance- ・Balance between ・Nutrition oriented system (From benefit and ・Enrichment of community improvement and “Helping the poor” to burden welfare sanitation “Preventing to be ・Stable and ・Communicable poor”) effective system disease prevention ・Enrichment of the Re-establishment of the ・”Normalization” social safety net ・Establishment of benefits social policy responding to the labor 22 ・”Welfare origin year” market change and change organizations (1973) in the family structure (Currently)(Reference: White Paper, MHW (1999)) 22
  • 23. 3.Outline and Challenges of Long-Term Care Insurance System (1)Outline of the system 23
  • 24. Outline of the LTCI system Outline of the Long-term Care Insurance System Municipalities (Insurer) 90% of the Service Providers Muni. Prefectures State benefit ○In-home serviceTax 12.5% 12.5%(※) 25%(※) ・Home Help50% ・Day Care ... ※For Facilities Benefit ○Facilities State 20%, Prefectures 17.5% ・Nursing HomesInsurance ・Health ServicePremium 20% 30% Facilities ... Claim 50% Set according to population ratio 10% Copay (Fy2009-2011) Finance Stabilization Meals and Utilities Fee Fund State-wide Pooling Service Provision Municipalities Insurers of medical care Premium insurance Withheld from pension Certification of Long-term Care Need First Insured Persons (65 Second Insured Persons Enrollees (insured) and over) (40 to 64)(42.76 million) (27.27million) 24
  • 25. Procedure for the use of services Outline of the LTCI system Introduction of “Care-Management” that ○Facilities Services enables the optimal choice of services within ・Nursing Homes the benefit limit that take into account various Those who are bedridden or dementia ・Health Services Facilities conditions such as the physical and mental and in need of services ・Long-term Care Hospitals Care Benefit condition of the elderly and the situation of services (Care Plan) Planning for the use of his/her family Care Level ○In-home Services Certification of Long-term Care Need Investigation ・Home Help ・Visiting Nurse ・Day Care ・Short Stay 1 to 5 etc. ○Community-based Services Municipalities ・Multifunctional Small-Sized Day Care Insured ・Home Help (Night Care) ・Group Home for the Demented Those who are at risk and in need etc. for assistance in daily life Opinion of MD ○Preventive Services Prevention Benefit ・Preventive Day Care Support Preventive Services Care Plan ・Preventive Rehabilitation Level 1 ・Preventive Home Help etc. or 2 ○Community-based Preventive Services Those who are at ・Preventive Multifunctional risk for becoming Small-Sized Day Care “Care Level” or ・Preventive Group Home for the “Support Level” Demented etc.For In-home Services, volume of the services ○Prevention Services Community Services Supportvaries according to the Care (Support) Level NotFor Facilities Services, fees paid to the ○Services according tofacilities vary according to the Care (Support) Certified the need of the 25 municipalitiesLevel 25
  • 26. Outline of the LTCI system Level of Care Need (Image) Support Care S.L 2 C. L. 2 C. L. 3 C. L. 4 C. L. 5 Level1 Level 1 ■Standing ■Sitting up ■Standing on one legLevelCharacteristic items for each Care (Support) ■Walking ■Washing the body ■Counting money ■Nail clipping ■Taking on and off the trouser ■Moving ■Decision making in daily life ■Washing face ■Setting Hair ■Oral hygiene ■Urination/Evacuation ■Seating Demarcation between ■Eating S.L. 2 and C.L. 1 are ■Delivering wishes decided by the difference of possibilities for ■Swallowing maintaining and ■Remembering recovering the level , Understanding 26 26
  • 27. Outline of the LTCI system Care Plan (Preventive Services Care Plan) • Services under LTCI are provided according to the individually-organized “Care Plan” • Care Managers at independent offices organize Care Plan for In-home Services. Care Managers at the “Comprehensive Community Care Support Centers” organize Care Plan for Preventive Services. (Examples of Care Plan)(Case1) C.L. 3 (Mainly using Day Care) (Case2) C.L. 3 (Using Short Stay) Mon. Tue. Wed. Thu. Fri. Sat. Sun Mon. Tue. Wed. Thu. Fri. Sat. Sun AM AM Home Help Visiting Nurse Home Help Home Help Home Help Home Help Home Help Day Care Day Care Day Care Day Care Short Stay PM PM Night Home Help Home Help Home Help Home Help Home Help Home Help Home Help MidnightRental Wheelchairs, Special Beds (with equipments) Rental Wheelchairs, Special Beds (with equipments) Care manager coordinates the service according to the need of the elderly. Each service is priced under the fee schedule (below), and the care manager coordinate the amount of service within the maximum limit according to their care level. Both of the cases above are within such limit. The elderly has alternatives for the combination of services, as well as the choice for service provider. 27 27
  • 28. Outline of the LTCI system Outline of the services under LTCI Visiting Services In-home home (Home Help, Visitng Nurse, Home Bathing Help, Care Management, etc.) Commuting ServicesFees from the ・Day Care ・Day Rehabilitation, etc.insurance is paidunder unified feeschedule. For each Short Stay Servicesservice, fees arebasically fixed ・Short Stay, etc.according to thelevel of care need ofthe service user. Collective Living Services ・Private Nursing Homes, “Care Houses” ・Group Home for the Demented, etc. Facilities Services Facilities ・Nursing Homes ・Health Services Facilities, etc. 28 28
  • 29. Long-term Care Service Plan Outline of the LTCI systemOnce in every three years, each insurer (municipality) reviews and revises its “Long-term Care Plan” .Premium rate is set so as to keep the financial balance for coming three years, taken into account theprojected amount of benefit (service provision). (Fixed-amount premium rate for three years.) Term of the plan Planning period Benefit amount Insurance Premium 1st 1st (FY) 2,911 Yen 2nd (National Avg.) 2nd 3,293 Yen (FY) (National Avg.) (FY) 3rd 3rd 4,090 Yen (National Avg.) (FY) 4th 4th 4,160 Yen (National Avg.)Every three years, fee schedule table is revised. The rate of total revision isaffected by the budget constraints, and is under huge political interest. 29
  • 30. Premium of the 1st insured (elderly) Outline of the LTCI system 50% of the benefit under LTCI are paid by 1st insured (65 and over) and 2nd insured (40 to 64), shared by the head-count of each category. Currently the share of the 1st is 20%. The insurer (municipality) imposes the premium to their elder citizen. The insurance premium is set by the level of residence tax in order to secure appropriate burden according to the income status of each of the elderly. Residence tax not levied Residence tax levied for for him/herself him/herself1st Insured Multiplier 4,160 Yen per month 20% (National Average) National Gov’t 25% 2nd Prefecture insured Gov’t 12.5% 30% 1st Level 2nd level 3rd level 4th Level 5th level 6th level Municipality Gov’t 12.5% Income 1st Level: Under Income 2nd Level: Residence 3rd Level: Residence 4th Level: At least 5th Level: 6th Level: Assistance Program tax not levied for all tax not levied for all one family member Residence tax Resicence tax family member, and family member, and is residence tax levied for the levied for the his/her own annual his/her own annual levied, but the insured. Annual insured. Annual pension income is pension income is insured is not civil income is below income is above below 800,000 yen above 800,000 yen tax levied 2,000,000 yen. 2,000,000 yen.The insurer (municipality) can set by their own discretion “the multiplier”, “income levelthat demarcates 5th and 6th level” or “more “steps” for upper-income level” so as tomeet the financial condition of their citizen. (i.e., they can impose more to the rich andreduce the burden of poor as far as that meet fiscal balance.) 30
  • 31. Discussion at the establishment stageArguments in 1990’sElderly care has been supplied under “medical care” servicesand “welfare” services. Medical Care: Hospitals, Clinics Welfare: Nursing homes (Special Nursing Homes, Nursing Homes for the Needy)Elderly care should be provided jointly by “medical care” typeservices and “welfare” type services. However, as they areprovided under different system, service provision has not beenwell coordinated. 31
  • 32. Easy access has been guaranteed for medical care Discussion at the establishment stageservices. However, medical care services(hospitalization) are more expensive compared to Characteristics of medical care services Contract with the hospital to betheir counterpart welfare services, and the services institutionalized.provided in hospital are not necessarily appropriate Cost is born by universally-coveredfor elderly care. (So-called “socially-incurred “Health Insurance”.hospitalization” problem) Fixed amount of copayment (then).Lengthy hospital stay is characteristic for Japanese medicalcare. For elderly patients, average lengths of stay is much Per person medical care expenditure is much higher forlonger than the younger. the elderly. (FY 1992) Average lengths of stay by age (days) (1990) 70 and ¥125,000 84.8 over ¥613,000 79.3 65 and over ¥63,000 ¥260,000 45.2 35 to 64 ¥44,000 17.5 ¥334,000 15 to 34 14.1 0 to 14 Non-elderly 0.0 50.0 100.0 Elderly 32
  • 33. Welfare services target specified Discussion at the establishment stagecategory of people. Process forutilization of welfare services is Medical Care: Easier access,complicated, and social stigma exists for copayment according to usethe use of such services. Welfare: “Designation” system, copayment per ability to pay Characteristics of welfare services For higher income people, “welfare” “Designation” system by the services were more expensive than government “medical” services. (The premise of such system is that the elderly are socially weak compared to By unnecessary hospitalization other generations, as they are easier to (socially-incurred hospitalization), lose mental and physical health. inefficient and unsatisfactory elderly Therefore, government needs to care services by higher cost has been enhance their welfare by designating provided. each individual as “needy”.) Per months institutionalization cost (then) Nursing homes : 270 thousand yen Financed by tax. Health Services Facilities : 330 thousand yen Regular Hospital : 500 thousand yen, Long- term Care Ward: 400 thousand yen Copayment depends on the income (monthly payment varies: 0 yen to 240 thousand yen) 33
  • 34. Discussion at the establishment stage To reduce the barrier between Governmental plan to increase the “medical service” and “welfare”, various new types of service were welfare services has been launched. created. 1989: “Gold Plan” (Nationwide development“Welfare-oriented” medical care services that plan to increase the Nursing Homes, Health Services, Home Help, Day Care, Short Stay,were newly created among others) 1985: Health Services Facilities (“Middle-way” institution to provide rehabilitation to 1993: “Elderly Health and Welfare Plan” the elderly whose sickness condition has stabilized) (Mandated to prefectures and 1992: Long-term Care Wards, Wards with Enhanced municipalities. A plan for necessary amount of services for its own citizen. ) Care Services (Hospital beds with higher per-bed number of nurses 1994: “New Gold Plan” and careworkers) (Strengthened version of the Gold Plan) 1992: Visiting Nursing Station (Providing medical services by nurse to elderly in Novel types of residence for the elderly need of care at home) has been innovated. 1989: “Care House” (For the elderly who does not need hospitalization or “designation” to the welfare facilities, but who does have concern to live at home) 1980: Private Nursing Home (Nursing homes provided by for-profit companies) (On the contrary, Hospitals, Nursing Homes, Health Service Facilities and “Care Houses” are provided by non-profit corporations.) 34
  • 35. Discussion at the establishment stageIncreased demand of the public to the elderly care servicesNecessity to break down the barrier between “medical care”services and “welfare” servicesEnrichment of the service provision by various “Plans”Basis for the establishment of new elderly long-term care system 35
  • 36. 2005 ReformOverview of the 2005 Long-term Care Insurance Reform 36
  • 37. Change to the Prevention-oriented System 2005 Reform 37
  • 38. Establishment of Regional Comprehensive 2005 ReformSupport Center Regional Comprehensive Support Center is a core body in the community, performing thefollowing 4 functions from the perspectives of ensuring equality and fairness:1)Total counseling support2) Rights advocacy including prevention and early discovery of abuse3) Comprehensive and continuous management support4) Care management to prevent the need for care (Preventive Care Plan) (Certified as “Support Level 1” or “Support Level 2” Counseling, Rights Advocacy Certified Social Worker Care Management Preventive Support Care Plan Chief Care Health Manager Nurse Established in all municipalities around the country (one in each junior-high school district as a target) 38
  • 39. 3.Outline and Challenges of Long-Term Care Insurance System (2) Development of ”Comprehensive Community Care” 39
  • 40. What is “Comprehensive Community”? Comprehensive Community Care(Objective of 2011 LTCI Law reform bill)Implement the measures to promote “Comprehensive Community Care System” thatprovides medical services, long-term care services, preventive services, residentialarrangements and life-support services in a seamless manner in order for the elderlyto live independent life in the community.“Comprehensive Community Care” means --- Regionally-organized system that provides various life-support service, not only medical care or long-term care but welfare services, within daily living zone to secure the safety, peace of mind, and health in daily life, on the basis of the provision of resident that accommodates the needs of the elderly. 40
  • 41. Expression “Comprehensive Community” at earlier stage of Long-term Care debate “Many of the bedridden elderly in Japan are artificially made”, criticized Dr. Yamaguchi about geriatricmedicine in Japan. Soon two decades will pass since Dr. Yamaguchi started working on measures toeliminate bed-ridden. Town of Mitsugi (population: about 4,800), a farming area in Hiroshima Prefecture, is facing depopulationand population aging. Of the total population , those over the age 65 occupies about 23.2%, which is wellabove the national average. However, the number of bedridden elderly is about twenty (around 1%).Reduced to a quarter for past ten years, the number is quite few compared to the national average ofabout five percent. Change from “Sit-back Medical Care" to “Delivery Medical Care" is the reason for such result. Originally, Dr. Yamaguchi is a surgeon. The first time he faced the problem of bedridden was not longafter the time he was appointed as head of the Mitsugi Hospital. He faced many patients who come backto the hospital as bedridden soon after his toil of overnight operation. Lack of nursing ability of family existed. That would lead to careless use of a diaper. But he felt theaftercare of the hospital was not enough. In 1975, he began to send nurses to visit patients at home who have been discharged. His try and errorcontinued, and he established “Comprehensive Community Care System” that the wall between themedical care and welfare is eliminated and that the integration among the hospital, government andcitizens has been realized. Various staffs will treat wide variety of issues from nursing and rehabilitation tohome remodeling and consultation of private concerns. Citizens register “Welfare Bank” and take part-involunteer home care. Silver bullets are understanding and motivation. “If all the people think about replacing the unfortunatereality in front to their own old age, soon they should get the answer what to do right now ." Dr.Yamaguchi has been invited around the country to lecture on the need to establish the health and welfareplan that fits the locality of each municipality. 1994.03.03 “Face: Dr. Noboru Yamaguchi who tackles with the strategy to reduce the bedridden to zero”, Yomiuri Newspaper (Morning, Osaka edition) 41
  • 42. Comprehensive “Comprehensive Community Care System” Community Care Daily Living Zone (within 30 minutes distance) LTC Life Medical support Care services Residential Preventive Arrangements Services Five viewpoints that realizes “Comprehensive Community Care”It is necessary for the realization of “Comprehensive Community Care” to enforce the necessary measures with five viewpoints belowin a comprehensive (appropriate mixture of services from 1. to 5. to meet the needs of the users) and continuous (seamless provisionof services throughout hospitalization, discharge and return to home) manner.1. Strengthened cooperation with medical care services - Enrichment of 24-hour home medicine, visiting nurse and rehabilitation. - Allowing several medical practices (such as sputum vacuuming) to care workers2. Enriched and strengthened long-term care services - Enhanced promotion of long-term care infrastructure (such as Special Nursing Homes) (FY 2009 Supplementary Budget: 160 thousands beds for 3 years) - Strengthening in-home services such as the establishment of “Periodical Round plus On Demand Service”3. Promotion of preventive services - Promotion of preventive services so as not to become in need of care, as well as care services that enhance the independence of the elderly4. Securing various life-support services (guardianship, meal delivery, shopping, etc.) and rights advocacy - Promoting various life-support services (life support such as guardianship or meal delivery, rights advocacy services such as property management) that accommodate the increase of elderly living alone or with spouse only or demented elderly5. Enhancing the provision of residents for continuous living of the elderly (Collaboration with the Ministry of Land and Transport) - Amending the Elderly Residence Law to include the for-profit nursing homes etc. that meet the standard for proper regulation 42
  • 43. Outline of the reform bill to amend the Long-term Care (LTC) Insurance Law and other related laws to strengthen the basis for the provision of long-term care services (tentative) (2011 REFORM)Implement the measures to promote “Comprehensive Community Care System” that provides medical services, long-term care services, preventive services, residential arrangements and life-support services in a seamless manner in orderfor the elderly to live independent life in the community.1. Strengthen the cooperation of medical care services and long-term care services1) Promote “Comprehensive Community Care” that provides medical services, long-term care services, preventive services, residential arrangements and life-support services in a cooperative manner.2) Assemble LTC Service Plan that take into account regional needs and issues in each daily living zone (ex. junior high school zone, community center zone, etc.)3) Establish “Periodical Round plus On Demand Service” that accommodate 24 hours and “Combined Service” to meet the need of the elderly living alone and in need of heavier care4) Combined and comprehensive provision of preventive service and life-support service at the discretion of the insurer (municipalities)5) Temporary postponing the abolishment of Sanatorium-type Medical Ward2. Securing the care worker and betterment of quality of services1) Allowing sputum vacuuming to Certified Care Workers and other care workers who take appropriate education2) Postponing the review of process for obtaining license of Certified Care Worker3) Complete enforcement of labor laws in care service industry. Strengthening disqualification and revocation regulation for care service industry to add the violation of Labor Standard Laws.4) Reform of “Disclosure of Care Service Information” system by abolishing the mandatory investigation3. Enhancing the residents for elderly1) Adding articles that protect the residents of for-profit nursing homes2) Allowing the establishment of the Special Nursing Homes for the Elderly to “Social Medical Corporation”.* Enhancing the provision of elderly residents with services by the collaboration of the Ministry of Health, Labour and Welfare and the Ministry of Land and Transportation (Revision of “Elderly Residence Law”)4. Promoting measures for demented elderly1) Promote the rights advocacy of the elderly by enhanced use of Civil Guardian system2) Promote the policy measures for demented elderly by municipalities5. Enrichment of the function of insurer1) Securing accordance between the LTC Service Plan and plans for medical care services or residential arrangements2) Enabling the designation of specified service provision corporation through public offer and selection6. Mitigating the increase of insurance premium Allowing the utilization of mandatory-secured fund for financial stabilization to decrease the insurance premiumsEffective Date: April 1, 2012 (Date of proclamation for “1 5)” and “2 2)”. 43
  • 44. 1. 2)Assembling LTC Service Plan that take into account regional needs and issues in each daily living zone (ex. junior high school zone, community center zone, etc.)Promotion of “Daily Living Zone Needs Survey” - NOT the “survey of wants” but the “survey of needs” by collecting data of the elderly in each municipality, including; household composition, issues related to dementia, income level, housing situation, health condition such as ADL or IADL, necessity of life support, degree of socializing, etc.. - By compiling the data and comparing with other districts, uniqueness of the life of the elderly in each district will show up, and the local government can plan the service provision in an efficient manner (“benchmarking effect”) - Throughout the course of such survey and the feedback of the results, elderly him/herself will realize his/her health and life condition and risk. More active participation for preventive measures is expected. 44
  • 45. An example of “Daily Living Zone Needs Survey”(Pilot study conducted in Usuki City, Oita) Certification Level of Care Need The level of care need is higher for women then men. For men, the level is significantly lower in TANO district. SHIMONOE, Women SHIMONOE, Men C.L. 2 C.L. 2 C.L. 1 C.L. 1 S.L. 2 S.L. 2 S.L. 1 S.L. 1 TANO, Women TANO, Men C.L. 2 C.L. 2 C.L. 1 C.L. 1 S.L. 2 S.L. 2 S.L. 1 S.L. 1 C.L. : Care Level S.L.: Support Level 45
  • 46. Example of analysis by the results of the survey<Point of view for analysis>Even for a small city like USUKI, differences in care level were found among the districts. We havefurther analyzed the reason for such differences by collecting and sorting the data by gender anddistrict.<Analysis 1 Share of the person with lower IADL (Instrumental activities of daily life)>For women, IADL lowers by age, but for men it is not.Compared to other towns (which conducted the pilot survey) the share of person with lower IADLis higher in USUKI, especially for men. It is possible that the senior gentlemen are not inclined tohelp himself for their daily life necessities, or they come to assume less social role by not goingout, therefore their IADLs have lowered despite their age. -> Necessity to promote engagement in social activities for senior gentlemen Instrumental IADL (1) Instrumental IADL (3 or less of the items below) Going out alone by bus or train ? Going shopping by yourself? SHIMONOE, M Preparing meals by yourself? SHIMONOE, W Making payment by yourself? TANO, M Cashing in and out by yourself? TANO, W 65-69 70-74 75-79 80-84 85- 46
  • 47. (2) Intellectual Activeness (2 or less of the items below) Intellectual Activeness Writing claims for pension by yourself? Reading newspapers? Reading books or magazines? SHIMONOE, M Interested in articles or TV programs SHIMONOE, W on health? TANO, M TANO, W 65-69 70-74 75-79 80-84 85-(3) Social Role (2 or less of the items below) Social Role Visiting friend’s house? Being consulted by friends or families? Visiting friend who is ill? Talking to young people from you? SHIMONOE, M SHIMONOE, W TANO, M TANO, W Sudden decrease for men in SHIMONOE is observed after age 75 65-69 70-74 75-79 80-84 85- 47
  • 48. Two multilayered aspects found in the development of Long-term Care Insurance1.Multilayered system (Medical care, Social Welfare, Community Health・・・) <Introductory phase>・Break the barrier between medical care and welfare. Introduction of Care Manager as coordinator.・Diversification of service provider corporations. (For profit companies, NPOs, Cooperative Associations,etc.) <2005 Reform>・Establishment of (new) “Care Prevention Benefit” and “Community Support Program (Care PreventionProgram)” (Enriching “Community Health” aspects such as improvements in physical function andnutrition improvement.)・Establishment of “Community-based Service” (Day Care for the Demented, Small-sized andMultifunctional Day Care, etc.) (“Long-term Care” sector evolved in an original (small-sized, moreintense person to person relationship) manner from mere hybrid of medical care and welfare.)・Establishment of “Regional Comprehensive Support Center” (Total counseling, Rights Advocacy, Care Management Support, Preventive Care Management)2. Multilayered actors (Hospitals, Welfare Services, Municipality Government, Citizens ---)・Strengthened participation and responsibility of the municipality government (Authority who exercise “designation” function by tax money -> Insurer who organizes services with balancing the cost (insurance premium) and benefit・”Cooperation and Collaboration” among various service providers with diversified license・Active participation of various social resources in the community (NPOs, Community Council of SocialWelfare, Local Neighborhood-watch Volunteers, Volunteer Organizations, Township Fraternity Societies,etc.) 48
  • 49. Two key concepts for Long-Term Care Insurance “Comprehensive Community Care” “Accountability”- - Evolution of Long-Term Care insurance has been achieved with its “Multilayered Aspects” as significant character.- - “Comprehensive Community” -> Symbolic word of Long-Term Care Insurance -Regarding the progress of “Comprehensive Community” concept, 2011 Reform is on the track of such evolution of Long-term Care Insurance. 49
  • 50. 3.Outline and Challenges of Long-Term Care Insurance System (3) Sustainability
  • 51. Sustainability Number of service user increased about 2.6 times larger than the first FY. Especially, the users of in-home services are increasing rapidly. Trends 介護サービス受給者数の推移(人) (各年4月サービス分) of the users of LTCI services (person) (April of each Fiscal Year) 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2000年 2001年 2002年 2003年 2004年 2005年 2006年 2007年 2008年 2009年 居宅サービス(介護予防を含む)In-home Services (including preventive services) 971,461 1,419,344 1,723,523 2,014,841 2,314,883 2,505,636 2,546,666 2,573,797 2,685,115 2,782,828 地域密着型サービス(介護予防を含む) Community-based Preventive Services 0 0 0 0 0 0 141,625 173,878 205,078 226,574 施設サービス Facilities Services 518,227 650,590 688,842 721,394 757,593 780,818 788,637 814,575 825,155 825,835 合 計 Total 1,489,688 2,069,934 2,412,365 2,736,235 3,072,476 3,286,454 3,476,928 3,562,250 3,715,348 3,835,237 51
  • 52. SustainabilityTotal amount of provided benefit doubled in 9 years. Total amount of benefit (in 100 millions yen) 年度別給付費 (単位:億円)70000 61600 64185 Total amount of60000 55594 57943 58743 benefit (in 100 50990 millions yen)50000 46576 4114340000 32427300002000010000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 52
  • 53. Sustainability Average monthly premium is 4,160 yen for the 1st insured (65 and over). FY 2000-2002 2003-2005 2006-2008 2009-2011 2,911 Yen (+13%) 3,293 Yen (+24%) 4,090 Yen (+1.7%) 4,160 Yen Insurance premium for the fourth term is “diluted” by subsidy.4,500 Yen (approx.)Without subsidy +Special tax subsidy to meet the increase of fee schedule to secure appropriate salary4,160 Yen for the careworkers(national avg.) + Cashing out of the reserve fund 53
  • 54. Two key concepts for Long-Term Care Insurance “Comprehensive Community Care” “Accountability”-- In many aspects of Long-Term Care Insurance System, enhancement of accountability is aimed.-- Most of the features to promote accountability also work to enhance the financial sustainability of the system. 54
  • 55. Significant features of the Long-Term Care Insurance Sustainabilitysystem to prevent the total cost from skyrocketingMain features from the beginning (learned from the experience of medical care insurance)+ Introduction of 10% fixed rate copayment (rather than fixed amount copayment)+ Introduction of maximum amount of use for each care level (services exceedingthat limit are financed 100% out-of-pocket)+ Introduction of “Care Management” that aims for providing only necessaryservices in a subjective manner2005 reform+ Change to the prevention oriented system (so as to prevent from becoming frail)+ Restraining (not eliminating) domestic help services by home helpers for theelderly with lower care need (daily-life assistance services (such as cooking mealstogether) are still provided )+ Introduction of copayment for meal, rooms and utilitiesDespite these features, due to the natural increase of the elderlypopulation, fiscal soundness has always been of concern. 55
  • 56. By rapid aging and elimination of one-time effect of Sustainabilitypremium increase “dilution”, huge increase of premiumin 5th period was projected. Throughout the 2011reform debate last year, additional measures to promotefinancial sustainability were on the table. Options debated to promote fiscal sustainability under “PAYG Principle” + Elimination of service for elderly with less care need + Increase of rate of copayment for the elderly with less care need + Increase of rate of copayment for elderly with higher income level + Introduction of copayment for “care management” service (currently no out-of pocket for “care management” to enhance its use) + Restriction for subsidy to the poor for room and board copaymentAll of the options above are to ask for the seniors to take “bitter pill”in some aspects. All are not employed as “being umpopular”. Theonly employed measure to reduce the premium increase was (again)the “dilution” by further cashing out of the reserved fund. 56
  • 57. SustainabilityCurrent Cabinet and the party in power agreed that the issues offunding for long-term financial stability should be discussed as awhole with other social security expenditures such as publicpension or health care. In the debate, increase of the consumptiontax rate is the potent alternative.At first, the discussion about the comprehensive reform of tax andsocial security system is supposed to be concluded in June thisyear. However, due to the disaster, political schedule is unclear atthis moment. Also, tremendous public finance needs for recoveryand rebuilding have changed the premise of the discussion abouttax and social security reform. Debate on fiscal sustainability is still ongoing in Japan. 57
  • 58. SustainabilityTrend of social security benefit and burden 58
  • 59. SustainabilityContribution and burden that supports the social security benefit Total: 91.4 trillion yen (2007(actual)) Interest revenue of accumulated Social Security Benefit: 91.4 tril. yen S.S. funds Social Insurance Premium: 56.9 tril. yen (65%) Tax: 31.0 tril. yen (35%) Local Tax: Employer: 29.7 tril. yen Employee: 27.2 tril. yen National Tax: 22.2 8.8 tril. (34%) (31%) tril. yen (25%) yen (10%) Insurance premiums Prefecture National Budget (general charged by each City, Town, system revenue) Village (27.3 tril. yen: FY 2010, (general revenue) 51% of total g.r.)Source: Ministry of Health, Labour and Welfare(Administrative cost is not included in the Social Security Benefit) 59
  • 60. SustainabilitySource: Ministry of Finance 60
  • 61. SustainabilitySource: Ministry of Finance 61
  • 62. - Long-Term Care Insurance has been modified rapidly so as to catch up the changes of the society.- Possible “options” are limited, due to the constraints given by the population change, economic situation, fiscal condition, etc., if you aspire to achieve long-term stability by eliminating the effect of economic fluctuation.- In addition to the rapid aging, economic globalization and swift technological change, social security system, including long-term care insurance, needs appropriate response.- Compared to the change in the socio-economic circumstances, people’s life consciousness and social norms tend to change more slowly.- Taking into account the facing constraints, it is likely that all of the “options” are not so sweet for people.How should we gain the understanding and consent of the people for necessary “swift change” through our the political process? → Biggest challenge for today 62
  • 63. 4. Conclusion 63
  • 64. Historically, Japan has learned a lot from the United States in manyaspects of society. One of them was the system for elderly care.PACE program in U.S. provided us the model to establish servicesystem under Long-Term Care Insurance.What are Programs of All-inclusive Care for the Elderly (PACE)? “Providing community-PACE is a Medicare program for older adults and people over age 55 based care and services”,living with disabilities. This program provides community-based care “flexibility to continueand services to people who otherwise need nursing home level of care. living in the community”,PACE was created as a way to provide you, your family, caregivers,and professional health care providers flexibility to meet your health “interdisciplinary team ofcare needs and to help you continue living in the community. An professionals”, orinterdisciplinary team of professionals will give you the coordinated “working together tocare you need. These professionals are also experts in working with develop most effectiveolder people. They will work together with you and your family (if plan of care” are also theappropriate) to develop your most effective plan of care. PACE significant feature of theprovides all the care and services covered by Medicare and Medicaid, LTCI system; these are theas authorized by the interdisciplinary team, as well as additional aspects that we learnedmedically-necessary care and services not covered by Medicare andMedicaid. PACE provides coverage for prescription drugs, doctor care, from PACE program astransportation, home care, check ups, hospital visits, and even nursing progressive, innovativehome stays whenever necessary. With PACE, your ability to pay will idea for providing carenever keep you from getting the care you need. services in a(excerpted from CMS homepage) comprehensive manner. 64
  • 65. -As the countries with graying population, both U.S. and Japan have enforcedvarious policies for the elderly. With such experiences and our common basicvalue for freedom and friendship in mind, U.S. and Japan could, and shouldLEAD THE WORLD TOGETHER to realize safe, healthy and content life forthe elderly people around the globe, who have enabled us to live in the worldas it is today. 65
  • 66. -Thank you for your attention! 66