Wednesday, April 16, 2008

T.R. Reid on Healthcare (Japan Included)

Old Japan hand T.R. Reid was last seen reporting from Colorado on the Kobe Bryant rape charge as the first, only, and probably last WaPo Rocky Mountain Bureau correspondent. (There was a video clip on the WaPo website back in the day, when it was hip to say back in the day (or so we thought).) Now, he has taken time out from writing his book on healthcare to star in a documentary on… what else? Healthcare. Enjoy.

Surprising for a Nihongo-phone like T.R. Reid, the video erroneously says that there’s no wait in Japanese hospitals. So very not so, sir. Otherwise, it’s to the point. Also, fair and balanced. No kidding.

Actually, I’ve been giving some thought to Japanese healthcare, and I’ve come to the conclusion that queues are essential to an affordable, effective and, yes, efficient universal healthcare system. I think that I’ve also come across some other features of the Japanese healthcare system that make more sense when you stop depending on conventional wisdom and outdated news reports to make your case.

ADD April 18: I've noticed that my last comment could be misconstrued as an attack on Tom. Not so, I am criticizing commentary that is diametrically opposed to his take. The Japanese healthcare system has many shortcomings, but so much of conventional wisdom does not take into account the fact that they are so often the result of unavoidable choices when the government is compelled to directly intervene in a market that is not a natural monopoly.

Stay tuned.


Sophie said...

Very interesting indeed.
The questions I would have asked are : how many students are in medical school, and how many new doctors do you get each year? Do they replace the retiring doctors?
As the doctors don’t apparently get very rich, do students with choice become traders rather than doctors?

Jun Okumura said...

Roughly half the doctors open clinics in their forties, when they earn slightly more than employed doctors, and reach their earning peak between the ages 55-59. Here are the relevant figures from, a 2006 report by the Japan Medical Association:

Total revenue 28.23 million
Amortization fixed investment 5,.55 million
Pre-tax, pre-social insurance fee income 22.68 million
Public pension and health insurance 1.08 million (deductable)
Retirement fund 0.72 million
National and local income taxes 6.19 million
Disposable income 14.69 million

Within the same 55-59 age group, they do better than fast-track bureaucrats and most likely better than the typical mid-level executive in a large corporation. They certainly earn much more than those cohorts during their 30s and 40s. So, a Japanese doctor may not make as much money as an American doctor (and not nearly as much as a Japanese dentist), but is clearly better off than an elite bureaucrat or the average big business salaryman.

According to the Ministry of Health, Welfare and Labor, there were 263 thousand doctors in 2006. That’s much lower per capita than the OECD average. There are 8,000 new doctors every year, so the number of doctors is growing, albeit gradually. But there’s a growing shortage of obstetricians and pediatricians. There’s a chronic overall shortage in the provinces as well.

All doctors enter medical school as an undergraduate for a six-year curriculum, so most of them do become doctors. So I think that you will see very few, if any, medical school graduates among financial traders.

Have I answered your questions, Sophie?

Sophie said...

Yes, thank you very much for the detailed info!

I was not thinking that medical school graduates would become traders, I referred to career choices before entering school.

How does the state manage the needs and shortages ?
For example, here, the state has closed the numbers of doctors graduating each year in the hope that less doctors would mean less demand in care (I know, sounds and is stupid). It didn't work, and on the contrary increased the gap between demand and offer, giving doctors a upper hand in medical rates and location negociations. The rates then increased.

Jun Okumura said...

Sorry, Sophie, I didn't make myself clear enough. I meant that in Japan, you can enter a medical school or the medical department of a university straight out of high school like any other discipline, only it takes six years to matriculate instead of the usual four. So typically, going to medical school is the first and usually last career choice you make.

In principle, a private medical school can be set up if it meets the necessary requirements. In the public sector, the Self-Defense Force has its own medical school that produces fully acredited doctors, but more significant is the push from the provinces to singly or jointly set up medical schools and departments to hopefully service their own needs. The national government has helped out in this respect, establishing a national medical school for the same purpose.

Caveat: This is not a subject that I'm really familiar with, and I'm writing this comment from memory. But I think that I've got it more or less correct. If I'm wrong, Ross will probably let us know.

BTW, I don't understand the logic behind the move in your country either. Since François Quesnay said that Supply creates its own demand, maybe your authorities thought that if they cut supply, then... LOL.

Anonymous said...

What if you are critically ill and in an ambulance and the crew cannot find a hospital that will accept you? Perhaps they are busy, or think you might have a contagious disease. And you die. Then what?

That's just one of the puzzling questions I had after watching the Old Japan Hand. I have more when I read the newspapers or see how my mother-in-law was treated when she had a serious illness and required long-term hospitalization. Well, the cost was low to us at first, so I guess that's all that is important.

Jun Okumura said...

I'm sorry to hear about your mother-in-law, Dan.