The Japanese government should be commended for establishing the Institute of Health Economics and Policy. The study of Health Economics has been long in forthcoming in Ja pan and hopefully, through this effort, more recognition and attention will be given to this growing field, already acknowledged for several decades in other countries like the U. S Issues which could hinder the success of the Institute are restrictions on data and research and limited recognition of the field by those outside the Institute.

This paper deals with the future direction of the long-term nursing care for the aged [LTCA] in our country. First, LTCA's desirable position in the society and its tentative definition are proposed by applying merit-goods concept.

Second, the present conditions of LTCA in Japan are criticized. The content of the section is the following; economic nature of health care service, the comparison with the fundamental characteristics of Japan's medical care system, and the problems caused by immatured social system regarding LTCA.

Third, the paper rejects public service, household function, and the general market mechanism as the major apparatus for promoting LTCA in the future.

Finally, the author recommends the "quasi-market" idea, i.e. the combination of statutory social insurance schemes covering the LTCA needs and a diversity of supplying organizations. Also, the role of nonprofit enterprises in the above stated quasi-market is explained.

In Japan all the prices of medical services are regulated by the government. This system is similar to other regulated industries where prices are determined on the assumption that they are based upon“costs". It is, however, very difficult to define economic costs in those industries because there usually exists common cost. In the case of medical service, hospital facilities, doctors and nurses, for example, are often common costs which can only be distributed artifitially among services according to the accounting principle. It is clear that economic benefits accrue to the society if we can find more efficient way of allocating resources in the medical sector. In this paper we examined the applicability of price capping to the medical services for the pursuit of more efficient pricing mechanism.

The long term trend of the health care expenditures of Japan is analised in terms of ①analysis of the chronological change of the factors of increase, particularly with the attention to (a) increase of accesibility, (b) technological innovation, (c) change of population structure, and ②corelation with economic growth. Based on these analyses, future prospests of Japanese health care expenditures and policies to be taken are presented.

My research focuses on the importance of inter-organization collaboration in view of efficient medical resource allocation. The discussions concern the following:

(1) I point out that there are 4 different types of information asymmetries between physicians and patients and among medical institutions that cause failure in efficient medical resource allocations.

(2) I point out that these information asymmetries are caused by the fact that medical service is transacted in the market ‘mode'.

(3) I discuss the merit and the demerit of the two ‘modes'-market and planning， and I propose that medical service should be supplied in the intermediate ‘mode' which has the merit of the market ‘mode' as well as the planning ‘mode'.

(4) I point out that ① incentives are more effective than regulations and ② information linkage among institutions and between physicians and patients are very important in view of public intervention that shifts the existing health care system to the one under the intermediate 'mode'.

We evaluated the economic aspects of the treatment of unruptured cerebral aneurysms (U-AN) using clinical decision analytical approach. Firstly, a decision tree suitable to the situation is determined, then, the probable values determined from literatures, that is, prevalence of U-AN 5% (25% in familial cases), annual risk of rupture 2% (6% in hypertension), operative morbidity 4% and mortality 0% of U-AN, over-all morbidity 24% and mortality 40% of ruptured aneurysm, are put into each branches of the tree. Age 35 to 74 is included in the object of the study. As the loosing benefit, cost of examination(MR angiography and conventional angiography) and treatment of unruptured or ruptured aneurysms, and loss of money due to be deficits (20 million yen) or death (40 million yen) are put into account.

The results show average total cost is less(98.1%) in medical checkup group than in non medical checkup group, and it was much less in high risk group such as hypertension(88.5%) or familial cases(86.6%). And, the total cost is very expensive at every year or every two years medical checkup than at every five years. From the analysis, it is concluded that every three to five years medical checkup on high risk group is recomended.

Medical expenditures of those elderly who died during March 1991 and February 1992 were analyzed using the micro data obtained by the Research Project on Medical Expenditure of the Elderly. The share of expenditures used for the deceased elderly was about 11 percent of the total expenditures of the elderly. It was observed that inpatient expenditures were dominant among deceased elderly, and the share increased as month of death approached. In average, per day expenditures for the months prior to the death of elderly people increased gradually as month of death approached for each age group. Detailed analysis on inpatient expenditures of deceased elderly, however, showed that a sharp increase in per day expenditures occurred for only 20 to 25 percent of them. Moreover, such increase started at late stage: only 2 months before death. The situation is thought to be quite different form USA for example, and this feature might be one of the major factors which contribute to keep Japanese medical expenditures at the present low level. The equitable distribution of medical expenditures between survivors and the deceased needs to be researched from various perspectives.

This report is based on “Think Tank nenpou”.

“Think Tank nenpou” is an annual report of research institutes in Japan, which is published by NIRA.

This report shows us the trend of studies done by research institutes in Japan, particularly studies on Health Care general, Health Economics, Health Policy and Welfare.

The data I used in this report is that from 1982 to 1992.

The number of studies by research institutes in Japan in average of 1982 and 1983 is 828 studies. But that in 1992 becomes 4,036, which amounts to about 5 times of that in 1982 and 1983.

The studies of Health Care general, Health Economics, Health Policy and Welfare is about 54 studies, 3.3% of the studies in 1982 and 1983. But that in 1992 increases to 202, which is 5.0% of the studies.

Therefore, studies of Health Economics is only 18 studies done for the last 11 years.