Developments in Long-Term Care Insurance in Japan

The recently-enacted Japanese long-term care (LTC) system was implemented to reduce so-called social hospitalization or warehousing of the elderly in expensive medical facilities. This paper seeks to evaluate recent patterns in Japanese LTC use and examine the factors associated with LTC utilization patterns. We show that the demand for LTC in Japan - particularly home care - is growing rapidly, as elderly consumers find subsidized LTC care preferable to and more available than hospitalization. At the same time, regional disparities in care persist and are likely to grow.