TOKYO -- The consumption tax increase set to go into effect next year will be reflected in initial medical examination and other fees, the ministry of health has decided.
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The consumption tax is scheduled to be raised from the current 8 percent to 10 percent in October 2019. Medical treatments cannot legally be taxed, but medical institutions must pay consumption tax on purchases of equipment and supplies. Boosting the initial examination and other fees is thus a way for institutions to cover the greater tax burden.
Initial examination fees are charged to patients seeing a doctor regarding a specific condition for the first time. The increased cost to the patient, expected to range from a few yen to some tens of yen per visit, will be decided based on the fiscal 2019 budget compilation late this year. Meanwhile, a package of policy options on how to offset the greater tax burden on medical facilities is set to be presented to a Nov. 21 meeting of the Ministry of Health, Labor and Welfare's Central Social Insurance Medical Council.
Higher fees for initial and repeat consultations as well as hospital stays were first implemented when the consumption tax was raised from 5 percent to 8 percent in April 2014, to make up for the rise in medical institutions' procurement costs. However, a health ministry study for the 2016 fiscal year showed that revenue from the fees covered 92.5 percent of the full cost to medical facilities of the higher tax rate. The ministry's higher fee decision for the next tax hike is designed to offset these costs entirely.
The ministry study also found that the impact of the higher tax burden varied significantly by medical institution type. At regular clinics, the higher fees brought in 111.2 percent of the amount going out in higher consumption tax payments, while at hospitals the increased fees covered 85 percent. Meanwhile, at government-designated advanced treatment hospitals requiring large investments in equipment and facilities, the higher fees made up for just 61.7 percent of their greater tax outlays. The ministry believes this shortfall at hospitals was caused by the fiscal 2014 fee reforms' heavy focus on initial and repeat consultation charges, as opposed to hospital stays.
The ministry intends to remedy the situation come October next year by boosting the ratio of the higher fees accounted for by basic hospital stay charges. However, long-term care -- often of elderly patients with chronic but stable health problems -- requires relatively little new capital investment. Thus, the ministry will lower the estimated burden of the higher consumption tax rate for institutions where 60 percent or more of inpatient capacity is made up of long-term care beds.
(Japanese original by Masahiro Sakai, Medical Welfare News Department)