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A comprehensive picture of costs in Japan's effective and efficient health care system.

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Introduction     1

Conventions and Usages     7

1. Overview: Health Care in Japan
Naoki Ikegami     8

Section I: The Macroeconomics of Health Care

Yukiko Katsumata     19


3. Factors in Health Care Spending: An Eight-Nation Comparison with OECD Data
Naoki Ikegami and Yoshinori Hiroi     33

4. Afterword: Costs---The Macro Perspective
William C. Hsiao     45

Section II: The Microeconomics of Health Care

5. The "Natural Increase" and Cost Control
Yoshinori Hiroi     53

6. Comparison of Capital Costs in Health Care between Japan and the United States
Koichi Kawabuchi     73

7. Comparison of Administrative Costs in Health Care between Japan and the United States
Naoki Ikegami, Jay Wolfson, and Takanori Ishii     80

8. Afterword: Costs---The Micro Perspective
George D. Greenberg     94

Section III: Technology and Costs

9. Comparison of Hospital Admission Rates between Japan and the United States
Toshihiko Hasegawa     101

10. High-Cost Technology in Health Care: The Adoption and Diffusion of MRI in Japan
Akinori Hisashige     106

11. Comparison of Pharmaceutical Expenditure between Japan and the United States
Naoki Ikegami     121

12. Sales, R&D, and Profitability in the Japanese Pharmaceutical Industry, 1981-92
Will Mitchell, Thomas Roehl, and John Creighton Campbell     132

13. Afterword: Quality and Cost in Japanese and U.S. Medical Care
John M. Eisenberg with Nancy Foster     143

Section IV: Institutions and Costs

14. Comparison of Long-Term Care for the Elderly between Japan and the United States
Naoki Ikegami and Takeshi Yamada     155

15. The Impact of Financing Reform: Inclusive Per-Diem Reimbursement in Geriatric Care
Yasuo Takagi     172

16. Waiting Lists in Japanese Hospitals
Naoki Ikegami and Shunya Ikeda     176

17. Comparison of Hospital Length of Stay and Charges between Japan and the United States
Naoko Muramatsu and Jersey Liang     184

18. Afterword: Implications for U.S. Health Care Policy Reform
William G. Weissert     193

Section V: Health Behavior and Attitudes

19. Paradoxical Comparison of Health Care Needs, Utilization, and Costs between Japan and the United States
Hiroko Akiyama     201

20. Keeping Pressures off the Japanese Health Care System: The Contribution of Middle-Aged Women
Margaret Lock     207

21. The Three-Minute Cure: Doctors and Elderly Patients in Japan
Ruth Campbell     226

22. Over My Dead Body: The Enigma and Economics of Death in Japan
Eric A. Feldman     234

23. Afterword: Social, Cultural, and Behavioral Factors
Arnold J. Rosoff     248

Section VI: Politics and Health Care

24. The Egalitarian Health Insurance System
John Creighton Campbell     255

25. The Evolution of Fee-Schedule Politics in Japan
Mikitaka Masuyama and John Creighton Campbell     265

26. The Japan Medical Association and Private Practitioners' Income
Yasuo Takagi     278

27. Afterword: National Health Insurance, Cost Control, and Cross-National Lessons---Japan and the United States
Theodore R. Marmor     286

Contributors     297

Index     301


The Japanese health care system provides universal coverage to a healthy but aging population. Its costs are among the lowest in the world and have remained nearly constant as a share of the economy for more than a decade. Americans concerned about runaway medical spending need to know about the successes that Japan has experienced and the problems the country has encountered in its effort to control costs while maintaining quality of care.

Offered here is an analysis of the key issues of cost-containment by specialists followed by reactions from some of America's best-known experts on health care delivery and finance. Topics include the macro-and microeconomics of health care, technology and costs, institutions and costs, attitudinal and behavioral aspects, and the politics of health care.

This collection provides an authoritative study of successful cost-containment in the Japanese health care system---a chronicle of success that is neither a statistical illusion nor a result of sociocultural factors. Detailed here is information on the key mechanism of cost constraint: a fee schedule that covers virtually all medical services and rewards inexpensive services while making expensive services unprofitable. This system has resulted in the provision of quality health care to the entire population at roughly half the cost of American health care. Is it a single-payer system? Would the United States have to introduce a dramatically altered health care structure to benefit from the Japanese experience? No. Japan relies mainly on fee-for-service medicine financed by multiple insurers---a system familiar to Americans and one from which many lessons may be learned.

Based on conferences held in Washington, D.C., and Izu, Japan, this volume collects original chapters on the overall cost structure, how the negotiated mandatory fee schedule works, specific mechanisms for cost control, the politics of health care financing, and the impact of cost cutting on quality, among other topics. These pathbreaking studies will be a significant resource for policymakers and scholars interested in comparative health care systems as well as those interested in health care reform in the United States.