Exploring a Public/Private Nexus of Health Care Provision: Ideas, Regulatory Frameworks, and Adaptability

The background of this paper is that dichotomy of public/private does not work well in analyzing, and even describing, healthcare provision in Japan. The Japanese healthcare system uses market mechanisms in providing health services: varieties of providers compete each other under a statutory health insurance system that decides fees or "prices" of services. Those providers consist of varieties of entities with different control by the government, including individual physicians, medical corporations, health insurance bodies, consumer cooperatives, agricultural cooperatives, the Red Cross Society, and local and national governments. Designated providers, including private ones, have been remarkably categorized as “pseudo-public”. They are responsible for making efforts to achieve regional health policies and eligible for applying for ling-fenced subsidies. This makes distinction between “public” and “private” vague. The distinctive vagueness have been maintained by the government.

This paper consists of two parts. First it analyzes why the government introduced the concept “pseudo-public” by considering historical development of the health system. This question will be analyzed with the following the two accompanied questions: why those private and “pseudo-public” providers were not absorbed into the government sector; and why local and national government did not expanded their provision to the extent that “pseudo-public” providers would not be necessary. In answering them, the paper considers ideas of “public” and “private”, historical development of regulatory frameworks on healthcare, and adaptability of healthcare markets.

Second, the paper analyzes recent transformation in which public/private distinction has become clearer, where local and national governments’ ownership of providers decrease and regulatory frameworks on the healthcare markets are modified. What external pressures, e.g. pressures for cost containments, have changed ideas, regulatory frameworks, and adaptability will be examined.

Finally, the paper critically considers the three concepts used in analysis and gives perspectives for future research.