The Japanese medical insurance system is the best in the world, as it enables anybody to receive medical treatment anywhere anytime, whereas the system in the United States has many restrictions and 15% to 17% of the Americans are not insured.

While American physicians have to spend much money to guard themselves against possible litigations, their Japanese counterpart have no such worries.

These and other comparisons between the medical practices of the two countries were explained in detail by Dr. Teruo Hirose, former clinical professor of surgery at New York College of Medicine, at an AJS monthly luncheon held at the Foreign Correspondents' Club of Japan in Tokyo on July 24.

Dr. Hirose is currently professor at the Department of Health Care Administration of Shumei University and serves as chairman of the Japanese Association for Health Care Administration.

He noted that most hospitals in the U.S. follow market principles and are quite profit-oriented. As a result, he said, chief executives of major American hospitals earn incredibly high income.

In contrast, he said, most Japanese hospitals are being managed incompetently, as exemplified by the fact that 90% of university hospitals are in the red and are receiving government subsidies.

This, Dr. Hirose said, is because a majority of Japanese medical institutions are run by doctors who know little or nothing about corporate management or profit-making, in stark contrast with American hospitals which are managed by professionals.

Although the university hospitals and public hospitals are to be transformed to corporations in two years' time, he said, nobody seems to know what must be done.

He went on to say that the Japanese pharmaceutical industry is in dire straits, as there are only two companies - Sankyo Co., Ltd., and Takeda Chemical Industries, Ltd. - which are competitive in the global market. He attributed this to lack of momentum toward mergers and acquisitions, which he noted have become common in the United States.

In this connection, he pointed out that mergers are being promoted among American hospitals. For example, the Medical Department of New York University has merged with Mt. Sinai Hospital to become New York Mt. Sinai Hospital. Thus, he said, New York City today has only three large hospitals.

Noting that Japanese hospitals are rivaling against each other, Dr. Hirose suggested that mergers may be the way to strengthen them. It has been reported, he said, that the hospitals of the University of Tokyo and Tokyo Medical and Dental University may be consolidated into one entity.

He said that medical expenses account for 14% of the gross national product (GNP) in the United States as against 7% in Japan.

The Japanese government's medical policies, he said, have been so haphazard that while medical expenditures have increased proportionately to the economic growth, no attempt has been made to reduce such expenditures when the economy is contracting.

The amount of taxpayer money which the U.S. government spends accounts for 4% of the total medical expenses, which is twice as high as in Japan, he pointed out, adding that the Japanese government has failed to tackle fundamental issues.

Hospitals in Japan, he said, face an urgent need to induce leading-edge technologies from the United States, because they lag far behind their American counterparts. For example, bypass operations in Japan number 20,000 per year as against 600,000 in the U.S.; there have been 15,000 cases of kidney transplant in the U.S. compared with 350 in Japan.

In contrast, however, Japan has a greater number of such equipment as CT scanners and MRI than the U.S. This, he said, suggests that Japan is well advanced in diagnosis but lags in treatment.

The number of outpatients in Japan, Dr. Hirose pointed out, is 9 persons per 1,000 population, which is twice as high as the global average of 4 to 5, where as the ratio of inpatients is low in Japan. This is because an average Japanese person does not hesitate to go to see a doctor even with slight symptoms, whereas in the United States, high medical costs keep patients away from doctors until their conditions become serious.

Japan, he said, is a paradise for medical practitioners because even if they commit a blunder, they are not expected to do anything more than making apologies. In the United States, however, doctors are constantly exposed to litigations from patients, which force them to spend 20% of their income to buy insurance policies. Many doctors in Japan fear that they might face a similar situation in the future, he added.