Japan Health System Financing - World Health Systems Facts

Population with household expenditures on health > 10% of total household expenditure or income (%), 2015-2021: 11.1%
Population with household expenditures on health > 25% of total household expenditure or income (%), 2015-2021: 2%
Domestic general government health expenditure (GGHE-D) as percentage of general government expenditure (GGE) (%), 2022: 23.42%

Source: World health statistics 2025: monitoring health for the SDGs, Sustainable Development Goals. Tables of health statistics by country and area, WHO region and globally. Geneva: World Health Organization; 2025. Licence: CC BY-NC-SA 3.0 IGO.

Out-of-pocket expenditure (OOP) per capita in US$, 2022: $426.79

Source: Global Health Observatory. Out-of-pocket expenditure (OOP) per capita in US$. Geneva: World Health Organization. Last accessed Jan. 23, 2025.

Out-of-pocket expenditure as percentage of current health expenditure (CHE) (%), 2022: 10.97%

Source: Global Health Observatory. Out-of-pocket expenditure as percentage of current health expenditure (CHE) (%). Geneva: World Health Organization. Last accessed Jan. 23, 2025.

Domestic private health expenditure (PVT-D) as percentage of current health expenditure (CHE) (%), 2022: 13.99%

Source: Global Health Observatory. Domestic private health expenditure (PVT-D) as percentage of current health expenditure (CHE) (%). Geneva: World Health Organization. Last accessed Jan. 23, 2025.

Domestic private health expenditure (PVT-D) per capita in US$, 2022: $543.98

Source: Global Health Observatory. Domestic private health expenditure (PVT-D) per capita in US$. Geneva: World Health Organization. Last accessed Jan. 23, 2025.

Domestic general government health expenditure (GGHE-D) as percentage of current health expenditure (CHE) (%), 2022: 86.01%

Source: Global Health Observatory. Domestic general government health expenditure (GGHE-D) as percentage of current health expenditure (CHE) (%). Geneva: World Health Organization. Last accessed Jan. 23, 2025.

Domestic general government health expenditure (GGHE-D) per capita in US$, 2022: $3,345.38

Source: Global Health Observatory. Domestic general government health expenditure (GGHE-D) per capita in US$. Geneva: World Health Organization. Last accessed Jan. 23, 2025.

Health expenditure per capita, USD PPP, 2022
– Government/compulsory: $4,491
– Voluntary/Out-of-pocket: $759
– Total: $5,251
Health expenditure by type of financing, 2021
– Government schemes: 8%
– Compulsory health insurance: 77%
– Voluntary health insurance: 2%
– Out-of-pocket: 12%
– Other: 1%
Out-of-pocket spending on health as share of final household consumption, 2021: 2.4%
Expenditure on retail pharmaceuticals by type of financing, 2021:
– Government/compulsory schemes: 72%
– Voluntary health insurance schemes: 1%
– Out-of-pocket spending: 27%
– Other: 0%
Total long-term care spending by provider, 2021
– Nursing home: 45%
– Hospital: 21%
– Home care: 19%
– Households: 0%
– Social providers: 0%
– Other: 15%

Source: OECD (2023), Health at a Glance 2023: OECD Indicators, OECD Publishing, Paris, doi.org/10.1787/7a7afb35-en.

“The Japanese health-care system is primarily funded through insurance premiums subsidized by taxes. Both the Central Government and the municipalities levy proportional income taxes and insurance premiums on their respective populations. According to National Health Care Expenditure (NHCE), insurance premiums contribute to 48.7% of financial contributions followed by public subsidies (38.8%) and patients’ copayments (11.7%) (Ministry of Health, Labour and Welfare, 2014a).”

Source: Sakamoto H, Rahman M, Nomura S, Okamoto E, Koike S, Yasunaga H et al. Japan Health System Review. Vol. 8 No. 1. New Delhi: World Health Organization, Regional Office for South-East Asia, 2018.

“The total proportion of NHCE [National Health Care Expenditure] drawn from taxation increased from 31.7% in 1995 to 38.8% in 2014. Although the share financed by the Central Government has been stable at around 25%, the absolute value largely increased from US$ 39 billion in 1985 to US$ 96.6 billion, which imposed a huge fiscal burden. However, insurance premium contributions declined rapidly during this period, from 56.4% in 1995 to 48.7% in 2014. The proportion of OOP payment fluctuated during this period and peaked at 14.4% in 2005. It has been gradually decreasing since, reaching 11.7% in 2014.”

“As shown in Table 3.10, Japan’s health financing system does not have a single payer for all insurance funds; insurers are divided into approximately 3000 organizations. As for the NHI [National Health Insurance], municipalities have the responsibility to collect premiums. Financial disparities between the NHI and Employees’ Health Insurance have been of major concern in recent decades. In particular, with urbanization and an ageing society, the size of risk pools in the NHI have changed significantly since 1961, and now many smaller municipalities face a declining funding base and increasing expenditure. Additionally, premium rates largely differ across municipalities, as do income levels. This fragmented insurer system remains a source of system inefficiency and premium inequities.

“There are several cross-subsidy systems among insurance schemes. For NHI, public subsidies are set to 50% of the total NHI budget, in which 32% come from the Central Government and 9% come from the prefectural government. Besides these subsidies from the Central Government and prefectural governments, an adjusting subsidy is also applied for 9% of the total NHI budget, which aims to enhance financial capacity among municipal governments. The Central and prefectural governments also support premium revenues that flow into NHI by contributing: subsidies for poor household premiums, subsidies for NHI who have a larger number of poor household, subsidies for adjusting differences among premium rates across municipalities, and subsidies for high-cost medical procedures.”

Japan: Health System Financing - National Policies - World Health Systems Facts

World Health Systems Facts is a project of the Real Reporting Foundation. We provide reliable statistics and other data from authoritative sources regarding health systems and policies in the US and sixteen other nations.

Page last updated August 8, 2025 by Doug McVay, Editor.