Japan’s social security system is one of the most comprehensive and complex systems, providing residents with all-round protection from “cradle to grave”. However, for foreign companies and individuals who set foot in this land for the first time, it is very necessary to analyze the Japanese social security system. Below we will deeply analyze its core components such as medical insurance, pension insurance, and unemployment insurance. Whether you are an entrepreneur considering entering the Japanese market or an individual about to start a new life in Japan, this comprehensive guide will become an indispensable reference. We will take you step by step to explore how to integrate into this system legally and efficiently to maximize the protection of your rights and interests in Japan. Let us work together to crack the code of Japan’s social security and protect your trip to Japan.

Overview of Japan’s social security system

The development process of Japan’s social security system is a microcosm that reflects the country’s modernization process. The prototype of this system can be traced back to the Meiji Era in the late 19th century, when Japan began to introduce Western social security concepts. The relief rules promulgated in 1874, although limited in coverage, are regarded as the starting point of modern social welfare in Japan. With the advancement of industrialization, the Factory Law of 1911 began to pay attention to the protection of workers’ rights and interests, laying the foundation for the subsequent labor insurance system.

The 1920s and 1930s were the initial formation period of Japan’s social security system. In 1922, Japan promulgated the Health Insurance Law, which was Japan’s first nationwide social insurance law, mainly targeting workers in the industrial sector. In 1938, the implementation of the National Health Insurance Law further expanded the coverage of medical insurance to include farmers, self-employed people and other groups. The promulgation of these two laws marks the formation of the prototype of Japan’s universal medical security system.

After World War II, Japan’s social security system entered a period of rapid development. Article 25 of the Japanese Constitution enacted in 1946 clearly stipulates that citizens have the right to a “healthy and cultural minimum life” (a healthy and cultural minimum life), which provided for the development of the post-war social security system. Constitutional basis. The promulgation and implementation of a series of important laws such as the Child Welfare Act of 1947, the Unemployment Insurance Act of 1949 (later developed into the Employment Insurance Act), and the National Pension Act of 1959 gradually established a social security network covering the entire population. In particular, the National Insurance and Pension System implemented in 1961 made Japan one of the few countries in the world to achieve universal medical insurance and pension insurance.

The basic principles of Japan’s social security system reflect the core values ​​and governance concepts of Japanese society. The principle of universality ensures that all citizens, regardless of their social status, occupation or income level, enjoy basic social security. The realization of this principle is mainly guaranteed through systems such as National Health Insurance and National Pension. For example, even freelancers or unemployed people can join the National Health Insurance and National Pension to obtain basic medical and pension security.

The principle of fairness emphasizes the reasonable distribution of social resources. This principle is mainly reflected in Japan’s social security system through progressive insurance premium payments and differentiated welfare benefits. For example, in health insurance systems, premiums are often linked to income, and low-income people and the elderly often enjoy lower out-of-pocket rates when using medical services.

The principle of self-help and mutual aid is another important feature of Japan’s social security system, which encourages individuals and society to share responsibility. This principle emphasizes that individuals should achieve basic living security through their own efforts, and also emphasizes mutual help among members of society. For example, in the pension system, the working-age population supports current retirees by paying insurance premiums, forming a mechanism of intergenerational mutual aid.

The principle of comprehensiveness ensures that social security covers all aspects of life. Japan’s social security system not only includes basic medical care, pensions, and unemployment insurance, but also covers many fields such as long-term care, work-related injuries, and childcare support. For example, the nursing insurance system introduced in 1997 specifically targets the long-term care needs of the elderly, reflecting the comprehensiveness of the social security system.

The principle of independence ensures that the operation of the social security system is free from excessive interference by political factors. In Japan, the management of social insurance funds is usually the responsibility of an independent administrative legal person or a special legal person. For example, the Japan Pension Institution is responsible for the management of the National Pension and the Employees’ Pension. This system design helps ensure the safety and stability of social security funds.

In Japan, social insurance and social welfare constitute the two pillars of the social security system, but there are obvious differences in their operating mechanisms and funding sources. Social insurance mainly includes medical insurance, annuity insurance, employment insurance and work-related injury insurance, etc., and follows the principle of “payment and mutual assistance”. Insured persons need to pay insurance premiums regularly to obtain corresponding protection. For example, in employee pension insurance, employees and employers jointly pay insurance premiums, and after retirement, employees can receive pensions corresponding to their contribution years and amounts.

In contrast, social welfare mainly provides welfare services without payment for specific groups, such as the elderly, disabled people, children, etc. Social welfare funds mainly come from government fiscal expenditures, which reflects society’s care for vulnerable groups. For example, the livelihood protection system provides cash subsidies and medical assistance to families unable to maintain the minimum living standard, which is fully borne by the government’s finances.

A distinctive feature of Japan’s social security system is its high degree of systematicness and comprehensiveness. It not only covers basic survival needs, but also extends to all aspects of improving the quality of life. For example, in addition to basic medical insurance, Japan has also established a specific disease medical expense subsidy system to provide additional medical expense subsidies to patients suffering from specific refractory diseases. In terms of pension security, in addition to basic pensions, there are also supplementary systems such as corporate annuities and personal annuities, forming a multi-level pension security system.

Another feature is that the Japanese social security system emphasizes the concept of combining “self-help, mutual assistance, and public assistance.” “Self-help” emphasizes personal responsibility and encourages people to achieve basic security through their own efforts; “mutual aid” is reflected in the social insurance system and helps each other through risk sharing among groups; “public assistance” is the government’s support through taxation and other means. The support of the social security system, especially to provide basic living security for groups who are unable to help themselves.

The refined management and efficient operation of Japan’s social security system are also its distinctive features. For example, Japan widely uses the social security and tax number system (commonly known as the “My Number” system) to integrate personal social security information, tax information, etc., greatly improving the efficiency and accuracy of social security management. In addition, Japan has also established a complete social security information system, enabling online processing of social insurance payments, welfare applications and other services.

In recent years, Japan has continued to promote the reform of its social security system in the face of challenges such as an aging population, low fertility rates, and slowing economic growth. An important reform direction is to gradually increase the pension age. Japan plans to raise the basic annuity receiving age to 65 by 2025, while encouraging the elderly to continue working to ease the financial pressure on the pension system.

In the field of medical insurance, Japan is promoting “medical insurance system reform” to control the growth of medical expenses while ensuring the quality of medical services. For example, Japan is promoting the use of generic drugs and adjusting the pricing mechanism of medical services to improve the efficiency of the medical system.

The long-term care insurance system is also constantly improving. Japan is strengthening home care services and promoting the “area including community care system” (community comprehensive care system), which aims to allow the elderly to obtain necessary medical and nursing services in a familiar community environment.

It should be noted that Japan is actively exploring the application of artificial intelligence and big data technology to social security management. For example, AI technology is used for medical image diagnosis, and big data analysis is used to predict social security needs. These innovations are expected to increase the efficiency of social security systems while reducing operating costs.

In order to cope with the labor shortage problem, Japan is gradually relaxing the social security participation conditions for foreign workers. The new status of residence “specified skills” system implemented in April 2019 not only provides new employment opportunities for foreign workers, but also ensures that they can enjoy the same social security benefits as Japanese nationals. This policy change is undoubtedly an important positive signal for foreign companies and individuals interested in entering the Japanese market, and will help attract more international talents to participate in Japan’s economic development.

These reforms and innovation initiatives demonstrate the Japanese government’s proactive attitude in facing socio-economic changes, and also provide valuable experience for other countries facing similar challenges. However, how to strike a balance between protecting people’s livelihood and controlling fiscal expenditures remains a long-term challenge facing the reform of Japan’s social security system.

Detailed explanation of the medical insurance system

Japan’s medical insurance system is one of the core pillars of its social security system. Based on the basic concept of “all citizens are insured”, it aims to provide comprehensive, fair and high-quality medical protection for all residents. This system not only embodies the spirit of mutual assistance in Japanese society, but also demonstrates the government’s great emphasis on national health. This chapter will delve into all aspects of the Japanese medical insurance system, including its overall structure, main types, insurance conditions, cost calculation, coverage, and medical treatment procedures. Through a comprehensive introduction, we will see how this system seeks a balance between protecting public health, controlling medical costs, and promoting social equity, and how it responds to challenges such as the aging population and advances in medical technology.

2.1 Overview of Japan’s medical insurance system

Japan’s medical insurance system is a complex, multi-layered, fully-covered system. Its design concept is to ensure that every resident can obtain necessary medical services while balancing the allocation and use of medical resources. This system mainly consists of three pillars: National Health Insurance, employee health insurance and the later-stage elderly medical system.

National health insurance is mainly for self-employed people, unemployed people and people who do not belong to other insurance types. It is managed by local governments and reflects the universality and localization characteristics of medical insurance. Employee health insurance is aimed at corporate employees and their families, and is divided into health insurance portfolios for large enterprises and association health insurance for small and medium-sized enterprises. The late-stage medical system for the elderly specifically serves those over 75 years old, reflecting Japan’s strategy to deal with the aging of the population.

This diversified structure allows Japan’s medical insurance system to adapt to the needs of different groups. For example, for freelancers with unstable incomes, National Health Insurance provides basic protection; while for corporate employees, employee health insurance can provide more benefits. At the same time, the establishment of a medical system for the elderly in the later period reflects attention to the special medical needs of the elderly.

Another important feature of the Japanese health insurance system is its financing model. Funding sources include premiums paid by insured persons, employer contributions, government subsidies, and financial adjustments between insurance plans. This diversified financing method helps spread risks and ensure the sustainability of the system.

However, in the face of challenges such as an aging population and rising costs brought about by advances in medical technology, Japan’s medical insurance system is also constantly adjusting. In recent years, the government has taken a series of measures, such as promoting the rationalization of medical expenses, strengthening preventive medicine, and promoting primary care, to maintain the long-term sustainability of the system.

Through its comprehensiveness, diversity and flexibility, Japan’s medical insurance system has achieved a relative balance between ensuring national health, controlling medical expenditures and promoting social equity, and has become an important object of study and reference for countries around the world.

2.2 National Health Insurance (National Insurance)

National Health Insurance, often referred to as “National Insurance”, is the most comprehensive part of Japan’s medical insurance system and is the key to realizing the concept of “universal insurance”. It is mainly aimed at those who cannot participate in employee health insurance, including self-employed people, freelancers, agriculture, forestry and fishery practitioners, unemployed people, informal workers, etc. The existence of national insurance ensures that these groups who may be excluded from the medical insurance system in other countries can also enjoy basic medical protection.

The operation of national insurance is mainly the responsibility of each municipality (equivalent to China’s city and county-level administrative units). This localized management model allows the insurance plan to better adapt to local economic conditions and demographic characteristics. For example, in areas with a high proportion of elderly people, the national insurance may pay more attention to chronic disease management; while in areas with a concentrated young population, it may pay more attention to maternity insurance.

National insurance has a wide range of insured objects. Although this feature reflects the inclusiveness of the system, it also brings some challenges. Due to the large differences in income levels and health conditions among insured people, the National Insurance Group faces greater financial pressure. Especially as the aging of Japanese society intensifies, the proportion of middle-aged and elderly participants in the national insurance continues to increase, resulting in an increase in medical expenditures while insurance premium income has relatively decreased.

To address these challenges, the Japanese government has taken a number of measures. The first is to increase financial support from the central government and ease the financial pressure on local state insurance through state subsidies. The second step is to promote the wide-area operation of the national insurance and expand the operating units from municipalities to the prefectural level to enhance risk diversification capabilities. In addition, the government is also actively exploring how to attract more young and healthy people to participate in the national insurance system to improve the structure of the insured population.

Another important feature of National Insurance is the way its premiums are calculated. Unlike employee health insurance, the premiums of the national insurance take into account not only the income of the insured, but also their asset status and family size. This complex calculation is intended to distribute the premium burden more equitably, but it also adds to the complexity of the system.

It is worth mentioning that the National Insurance also provides insurance premium reduction policies for low-income groups. Depending on the family income level, insured persons may receive partial or full insurance premium reductions, which reflects the inclusive nature of Japan’s social security system and its care for vulnerable groups.

National Insurance plays an indispensable role in Japan’s medical insurance system. It is not only an important tool in achieving universal health insurance, but also a key component of Japan’s social safety net. Despite facing many challenges, through continuous reforms and adjustments, the National Health Insurance Corporation is working hard to maintain its sustainability and continue to provide basic medical protection to Japanese residents.

2.3 Employee health insurance

Employee health insurance is another important component of the Japanese medical insurance system, mainly for corporate employees and their families. This system reflects Japanese society’s protection of workers’ rights and interests, and also reflects the company’s social responsibility in employee welfare. Employee health insurance is mainly divided into two types: health insurance portfolios operated independently by large companies, and health insurance managed by the National Health Insurance Association (referred to as “Association”) for employees of small and medium-sized enterprises.

Health insurance packages are usually set up by large businesses with more than 700 employees. These companies can design more personalized insurance plans based on their own characteristics and employee needs. For example, some businesses may increase dental insurance coverage or offer more health check-ups. This flexibility allows health insurance packages to better meet the needs of a specific industry or business.

The association mainly serves employees of small and medium-sized enterprises. It is established under the leadership of the government and operates uniformly across the country to provide standardized insurance services to companies that are unable to set up separate health insurance portfolios. Although the flexibility of the association is not as good as the health insurance package, it ensures that employees of small and medium-sized enterprises can also enjoy high-quality medical insurance.

A distinctive feature of employee health insurance is the “employer and employee joint contribution” model. Normally, the insurance premium is 50% borne by the employer and 50% by the employee. This design not only reduces the financial burden on employees, but also encourages employers to pay more attention to the health of their employees. After all, employee health is directly related to a company’s productivity and insurance premiums.

Compared with national health insurance, employee health insurance often provides more generous benefits. For example, many employee health insurance plans offer lower deductibles, some as low as 20% (compared to 30% for state insurance). In addition, employee health insurance often provides additional benefits, such as more comprehensive health examinations, child care subsidies, rehabilitation treatment, etc.

In recent years, in response to the pressure of rising medical costs, many health insurance groups and associations have been actively promoting health management plans. These plans not only include routine health examinations, but also cover health education, disease prevention, chronic disease management and other aspects. Some innovative practices, such as the introduction of wearable devices to monitor employees’ health conditions and provide healthy diet guidance, all show that employee health insurance is changing from simple “treatment insurance” to “health management”.

However, employee health insurance also faces some challenges. The first is the continued rise in insurance costs. As medical technology advances and the population ages, medical expenditures continue to increase, which results in insurance rates having to increase year by year. Second is the inequality between different insurance plans. Large corporate health insurance packages often offer better benefits, while SMB employees may be at a relative disadvantage.

To address these challenges, the Japanese government is promoting a series of reforms. For example, encourage mergers between health insurance portfolios to enhance risk diversification capabilities; strengthen the control of high medical expenses; promote the transparency of medical expenses, etc. These measures are designed to ensure the long-term sustainability of the employee health insurance system while safeguarding its status as an important component of Japan’s social security system.

The employee health insurance system is an important pillar of the Japanese medical insurance system. It not only provides comprehensive medical protection for the majority of the employed population, but also promotes the enthusiasm of enterprises to participate in employee health management. Despite facing many challenges, through continuous innovation and reform, the system is developing in a more equitable, efficient and sustainable direction.

2.4 Late-stage medical system for the elderly

The late-stage elderly medical system is an insurance system in the Japanese medical insurance system specifically for seniors over 75 years old (or specific disabled people aged 65-74 years old). This system was introduced in 2008. It is an important measure for Japan to cope with the rapid aging of the population and reflects the government’s emphasis on the special medical needs of the elderly.

The main purpose of establishing the later-stage medical system for the elderly is to better manage and allocate medical resources while providing more specialized medical services to the elderly. Under this system, people over 75 years old are separated from the original medical insurance system (such as National Health Insurance or employee health insurance) and form an independent insurance group. This design allows policymakers to more precisely target the needs of older adults, such as increasing coverage for chronic disease management, long-term care, and more.

Funding sources for the late-stage elderly medical system include three parts: insurance premiums paid by insured persons, support funds from various medical insurances (provided by insurance plans for younger groups), and public expenditures (subsidies from central and local governments). This diversified funding model is designed to spread risks and ensure the financial sustainability of the system. Under normal circumstances, the insurance premium of the insured accounts for about 10% of the total cost, the support fund accounts for about 40%, and the public expense accounts for about 50%.

In terms of medical cost sharing, the out-of-pocket ratio of most insured persons is 10%, which is significantly lower than that of other age groups. This preferential policy takes into account the economic status and higher medical needs of the elderly. However, for seniors with higher incomes, the self-payment ratio may be increased to 20% or 30% to reflect the fairness of the system.

The later medical system for the elderly also includes some special designs. For example, to control health care costs, the system encourages the use of generic drugs rather than expensive brand-name drugs. At the same time, it also emphasizes preventive medical care and provides comprehensive health examinations and health consultation services, aiming to improve the quality of life of the elderly and reduce unnecessary medical expenditures.

However, this system has also faced some controversies and challenges since its implementation. The first is the issue of intergenerational equity. Since most of the system’s funding comes from younger groups and government subsidies, some believe this could increase the burden on young people. Secondly, there is the issue of medical service quality. Some critics worry that classifying older people separately could lead to them being treated differently and affect the quality of care.

In response to these challenges and criticisms, the Japanese government continues to adjust and improve the system. For example, adjusting the insurance premium calculation method to make it more fair; expanding the scope of medical services, including increasing home medical and nursing services; strengthening supervision of medical quality, etc. The government is also actively exploring how to better integrate the medical system for the elderly with the long-term care insurance system to provide more comprehensive health protection for the elderly.

The late-stage medical system for the elderly is an important attempt in Japan to cope with the challenges of population aging. Although controversial, it provides an innovative solution to ensuring that seniors receive appropriate health care. As Japanese society ages, the importance of this system is likely to increase further. In the future, how to find a balance between protecting the rights and interests of the elderly and maintaining equity between generations will be an important issue facing the Japanese medical insurance system.

2.5 Conditions and procedures for participating in medical insurance

In Japan, participation in health insurance is compulsory and all residents must have some form of health insurance. This provision is a direct reflection of Japan’s “national insurance” concept, which aims to ensure that everyone has access to basic medical protection. Enrollment requirements and procedures vary depending on the type of insurance, but are generally relatively simple and straightforward.

For National Health Insurance (National Insurance), the insured are mainly people who cannot participate in employee health insurance, such as self-employed people, freelancers, unemployed people, etc. Enrollment procedures usually require registration at the local municipal office. Documents required when applying include resident registration certificate, residence card (for foreigners), proof of income for the previous year, etc. It is worth noting that even people with no income need to be insured, but can apply for premium reductions.

Participating in employee health insurance is relatively simple. Under normal circumstances, when a person is employed by a company and works more than three-quarters of the standard working hours of a regular employee of the company, the employer is obliged to provide health insurance for the person. The insurance enrollment procedures are automatically handled by the employer when the employee joins the company, and the employee usually does not need to perform additional operations. However, employees need to provide necessary personal information, such as family members, etc., in order to determine whether they need to apply for insurance for their family members.

For the later-stage elderly medical system, when an individual reaches the age of 75, they will automatically switch from the original insurance type to this system. For people with specific disabilities aged 65 to 74 who wish to join the system, they need to apply to the local wide area alliance (a joint organization of local governments that operates the late-stage elderly medical system).

For foreigners who come to Japan for a short-term stay and hold a “short-term stay” visa, they usually cannot join Japan’s public medical insurance. It is recommended for this group of people to purchase private travel insurance. For foreigners who live in Japan for more than three months, according to Japanese law, they must join the corresponding medical insurance. This includes international students, work visa holders, etc.

For foreigners who have just arrived in Japan, the insurance enrollment process may seem a bit complicated. To this end, many local governments provide multilingual guides and consulting services to help foreign residents understand and complete the insurance enrollment procedures. Some universities and companies will also provide relevant guidance for international students and foreign employees.

After enrolling in insurance, everyone will receive a health insurance card. This insurance card is very important and needs to be carried with you when seeking medical treatment. If your work status changes, such as leaving your job, changing jobs, etc., your insurance information needs to be updated in a timely manner. For example, after leaving the company, you need to transfer to the National Health Insurance within 14 days.

Another feature of Japan’s medical insurance system is that there is “no waiting period”, that is, once you are insured, you can immediately enjoy the insurance benefits, which to a large extent reflects the humanity of the system.

However, this universal insurance system also faces some challenges. For example, some young people may avoid enrolling because of financial pressures. To this end, the government has taken a series of measures, such as strengthening publicity and education, providing insurance premium subsidies, etc., to ensure full coverage of the system.

Although the conditions and procedures for participating in Japanese medical insurance vary depending on the type of insurance, they are generally relatively simple and user-friendly. This design helps ensure that everyone can easily join the medical insurance system, thereby achieving the goal of universal medical coverage. However, as the socio-economic situation changes, how to further optimize the insurance participation process and increase the insurance participation rate is still an issue that policymakers need to continue to pay attention to.

2.6 Insurance premium calculation method and payment method

The premium calculation method and payment method of Japanese medical insurance vary depending on the type of insurance, but generally follow the principle of “affordability”, that is, the insurance premium is determined based on the financial ability of the insured. This design aims to ensure fairness and sustainability of the system. At the same time, Japan also provides a variety of payment methods and tax exemption policies to meet the needs of different groups.

For National Health Insurance (National Insurance), the calculation of insurance premiums usually includes three parts: income proportion part, asset proportion part and equalization proportion part. The income proportion part is calculated based on the insured’s income in the previous year; the asset proportion part considers the value of the insured’s fixed assets; the equal proportion part is the basic expense that each insured person needs to bear. The specific calculation formula and the proportion of each part are determined by each local government according to local conditions, so the national insurance premiums may differ in different regions.

For example, a typical calculation formula may be: annual insurance premium = (annual income × income proportion coefficient) + (fixed asset tax amount × asset proportion coefficient) + equal proportion amount

The payment method of national insurance is relatively flexible. Participants can choose to pay monthly, quarterly or one-time payment for the entire year. Many local governments also provide multiple payment channels such as bank transfer and credit card payment to facilitate the insured.

The premium calculation for employee health insurance is relatively simple and is usually calculated based on a fixed percentage of the employee’s standard monthly salary. This ratio varies between different health insurance packages or associations, but is generally between 9% and 10%. The insurance premium is borne jointly by the employer and the employee, usually 50% each. The portion borne by the employee is directly deducted from the monthly salary and paid by the employer on his behalf, which greatly simplifies the payment process.

For example, if an employee’s standard monthly salary is 300,000 yen and the insurance rate is 10%, then:

• Monthly insurance premium = 300,000 × 10% = 30,000 yen
• Employee share = 30,000 × 50% = 15,000 yen

The insurance premiums of the late-stage medical care system for the elderly include a fixed amount and an income-related amount. The fixed portion is the same for all enrollees, while the income-related portion is adjusted based on the enrollee’s income level. The specific calculation method is determined by the wide area cooperation of each prefecture. For pensioners, the premium is usually deducted directly from the pension. Other insured persons can choose to pay by bank transfer or bill payment slip.

In order to reduce the burden on low-income groups, the Japanese government has provided a series of insurance premium reduction policies. For example, for national insurance, if the family income is below a certain standard, you can apply for insurance premium reduction, and the reduction rate may be as high as 70% or more. There is also a similar reduction and exemption policy for the later-stage elderly medical system. These measures reflect the social fairness of Japan’s medical insurance system.

In addition, Japan has also established an insurance premium deferral system. If the insured is temporarily unable to pay insurance premiums due to unemployment, illness, etc., they can apply for deferral of payment to avoid losing insurance qualifications due to failure to pay premiums.

However, there are also some challenges in calculating and paying insurance premiums. For example, as medical costs rise, insurance premiums also increase year by year, which puts financial pressure on many families. At the same time, due to the aging of the population, the number of contributors has decreased while the number of beneficiaries has increased, further increasing the financial pressure on the system.

To address these challenges, the Japanese government is exploring a variety of options, such as adjusting insurance premium calculation methods, expanding the insurance premium base, and strengthening medical cost control. At the same time, consideration is also being given to how to achieve a better financial balance between different insurance types.

The premium calculation method and payment method of Japanese medical insurance reflect the principle of “shared burdens and ability to afford”. Through flexible design and humanized policies, it ensures the sustainability of the system while also taking care of different people as much as possible. group needs. However, how to maintain the balance of this system under increasingly severe financial pressure will be an issue that requires continued attention and resolution in the future.

2.7 Medical insurance coverage and out-of-pocket ratio

The coverage of Japanese medical insurance is quite extensive and basically covers most common medical services and treatments. This comprehensive coverage ensures that residents can receive necessary medical services when needed without having to worry unduly about medical costs. However, in order to control medical costs and prevent excessive medical treatment, Japan has adopted a self-payment ratio system that requires patients to bear part of the medical expenses.

Medical insurance coverage mainly includes:

• Outpatient diagnosis and treatment: including general diagnosis, various examinations (such as blood tests, X-ray examinations, CT scans, etc.), prescription drugs, etc.
• Hospitalization: including ward fees, surgery fees, anesthesia fees, postoperative care, etc.
• Emergency services: including emergency room diagnosis and treatment, ambulance services, etc.
• Maternity services: including prenatal check-ups and childbirth-related expenses (although normal childbirth itself is not covered by insurance, many local governments provide childbirth subsidies).
• Chronic disease management: long-term treatment and management of chronic diseases such as diabetes and hypertension.
• Mental health services: including psychological counseling, psychiatric treatment, etc.
• Rehabilitation treatment: such as physical therapy, speech therapy, etc.
• Dental treatment: basic dental diagnosis and partial restorative treatment.
• Preventive medical services: such as regular physical examinations, vaccinations, etc.

However, there are some items that are not covered by medical insurance, including:

• Cosmetic plastic surgery
• Price difference for premium wards
• Non-medically necessary services, such as healthy food, health massage, etc.
• Certain new or experimental treatments
• Normal childbirth expenses (although there are other subsidies)
• Assisted reproductive technologies such as artificial insemination and in vitro fertilization
• Over-the-counter medicines

The self-payment ratio is an important feature of the Japanese medical insurance system, which varies according to the age and income level of the insured:

• Adults under 70 years old: usually pay 30% out of pocket
• Seniors aged 70-74: usually pay 20% out of pocket (except those with higher incomes, who may need to pay 30% out of pocket)
• Seniors over 75 years old: usually pay 10% out of pocket (those with higher incomes may need to pay 20% or 30% out of pocket)
• Children under the age of compulsory education: The self-payment ratio varies from region to region, and some regions provide free medical care.

This differentiated self-payment ratio design takes into account the financial capabilities and medical needs of different age groups, reflecting the fairness of the system and the protection of vulnerable groups.

In order to prevent high medical expenses from placing an excessive burden on families, Japan has also established a high medical expense subsidy system. When the medical deductible in a month exceeds a certain amount, the excess amount can be subsidized. This cap amount is based on family income level and age. For example, for a family with an average income, the monthly out-of-pocket upper limit for members under 70 years old is approximately 80,100 yen + (total medical expenses – 267,000 yen) × 1%.

In addition, Japan also has some special medical expense reduction policies. For example, for certain diseases (such as cancer, hemophilia, etc.), the government provides additional medical fee subsidies. For low-income families, there are also special medical fee exemption policies.

Although Japan’s medical insurance coverage and self-payment ratio systems generally ensure the accessibility and fairness of medical services, it also faces some challenges. For example, as new medical technologies continue to emerge, determining which new technologies should be included in insurance coverage has become a complex issue. At the same time, some citizens also report that the out-of-pocket payment ratio is still high, especially for patients with chronic diseases that require long-term treatment.

To address these challenges, the Japanese government is exploring a variety of options. For example, strengthen the evaluation mechanism of new medical technologies and decide whether to include them in insurance coverage based on cost-benefit analysis; promote a hierarchical diagnosis and treatment system and encourage patients to seek treatment in primary medical institutions first to control medical costs; strengthen the prevention and management of chronic diseases to reduce unnecessary hospital care; and improving the efficiency of aged care services, including expanding home care and community care services.

In addition, the Japanese government is also considering the following measures:

• Raising health insurance premiums: Although this may cause public dissatisfaction, it is considered necessary to maintain the sustainability of the system.
• Expand telemedicine services: Leverage technological innovation to improve the accessibility and efficiency of medical services, especially in rural and remote areas.
• Encourage healthy lifestyles: Through public education and incentive programs, encourage citizens to develop healthy living habits and reduce medical needs at the source.
• Introduce intelligent medical systems: Use artificial intelligence and big data technology to optimize the allocation of medical resources and improve diagnostic accuracy and treatment effects.
• Reform the drug pricing mechanism: Review and adjust drug prices more frequently to control the growth of drug spending.
• Strengthen international cooperation: Share experiences and solutions with other countries facing similar challenges and jointly explore sustainable medical security models.
• Cultivate more medical professionals: especially in the fields of geriatric medicine and chronic disease management to meet the growing medical needs.
• Promote innovation in the medical industry: Encourage the development of medical devices, biotechnology and other related industries to not only improve medical quality but also create new economic growth points.

The implementation of these measures requires the coordination and cooperation of governments, medical institutions, insurance companies, patients and other parties. The Japanese government is working hard to find a balance between ensuring medical quality, controlling costs and maintaining social equity to ensure the long-term sustainability of the medical insurance system. However, in the face of continuing challenges such as an aging population and advances in medical technology, the reform of Japan’s medical insurance system will remain a long-term and complex process.

2.8 Medical insurance coverage and out-of-pocket ratio

Japan’s medical insurance system is known for its comprehensiveness and efficiency, covering the vast majority of medical services and drugs. This system is designed to ensure that all citizens have access to necessary medical services while controlling costs through reasonable out-of-pocket payments.

Medicare coverage includes outpatient and inpatient care, surgery, delivery, dental treatment, prescription drugs, rehabilitation, and more. Most routine medical services are covered, but some elective or experimental treatments may not be covered. It is worth noting that Japanese medical insurance also covers preventive medical services, such as regular physical examinations and vaccinations, which reflects the emphasis on preventive care in the Japanese medical system.

In terms of self-payment ratio, Japan adopts a gradient system adjusted by age and income level. Generally speaking, adults under the age of 70 pay 30% of their medical expenses out of pocket, seniors aged 70-74 pay 20%, and seniors aged 75 and above pay 10%. For children under 6 years old, the out-of-pocket rate may be lower. However, these rates are adjusted based on the income level of the individual or family, with lower-income groups likely to enjoy lower out-of-pocket rates.

In order to prevent high medical expenses from placing an excessive burden on patients, Japan has also established a self-payment cap system. When monthly medical out-of-pocket expenses exceed a certain amount, the excess will be fully borne by the insurance. This cap amount varies based on age and income level, effectively protecting patients from catastrophic medical expenses.

In addition, the Japanese government also provides additional protection for specific diseases and special groups. For example, there may be special exemption policies for patients with certain chronic diseases; there is also a special subsidy system for people with disabilities. These measures further reflect the humanity and inclusiveness of Japan’s medical insurance system.

2.9 Procedures and precautions for medical treatment in Japan

The process of seeking medical treatment in Japan is relatively simple and straightforward, but there are some features and precautions worth knowing. First of all, Japan does not have a mandatory hierarchical diagnosis and treatment system. Patients can go directly to large hospitals for treatment. However, the government encourages patients to go to small clinics for treatment first and then transfer to large hospitals when necessary to improve the efficiency of medical resource utilization.

The medical treatment process usually begins with registration. Many medical institutions provide telephone or online appointment services, but small clinics may only accept on-site registration. Upon arrival at a medical facility, you will need to show your health insurance card and fill out relevant forms. For first visits to a medical facility, detailed personal information and medical history may be required.

During the consultation, the doctor will ask about symptoms in detail and conduct necessary examinations. If special tests or treatments are needed, the doctor will explain why and ask for the patient’s consent. It is worth noting that Japanese doctors usually explain the condition and treatment options in detail, and patients have ample opportunity to ask questions and express their opinions.

After the treatment, the patient needs to go to the billing office to settle the bill. Most medical institutions can settle the bill directly with the health insurance card, and the patient only pays the deductible. If a prescription is issued, the patient needs to go to a pharmacy to pick up the medicine. Many medical institutions have pharmacies inside, making it convenient for patients to get one-stop medical treatment.

When seeking medical treatment in Japan, there are a few things you need to pay special attention to:

• Language barrier: While some medical facilities in big cities may be equipped with translation services, medical staff in many places may not be proficient in foreign languages. It is recommended to prepare a description of symptoms in Japanese before seeking medical treatment, or to seek companionship from someone who understands Japanese.
• Clinic hours: Japanese medical institutions usually have fixed clinic hours, and some clinics may not be open during lunch hours and weekends. It is recommended to check opening hours in advance, especially during holidays.
• Waiting time: Although Japan’s medical services are relatively efficient, treatment in large hospitals may require a long waiting time. It is recommended to bring enough waiting time.
• Payment methods: Although most medical institutions accept cash and credit cards, some small clinics may only accept cash. It is recommended to carry enough cash with you.
• Drug use: Japanese drug instructions are usually only in Japanese. If you have any questions, you should consult a doctor or pharmacist in time. Certain medicines that may be available over-the-counter in other countries may require a prescription in Japan.
• Emergency: In case of emergency, you can call the emergency number 119. However, it is important to note that not all ambulances are staffed by personnel who speak foreign languages.
• Cultural differences: Japan’s medical culture may differ from other countries. For example, a doctor may not proactively provide copies of medical records, but should ask for them if needed.

Understanding these procedures and precautions can help make the medical treatment process in Japan smoother and more efficient. Although there may be some language and cultural challenges, Japan’s high-quality, comprehensive medical service system can provide patients with a good medical experience.

Detailed explanation of the pension insurance system

Pension insurance is an important part of the social security system, aiming to provide basic living security for citizens after they become old or lose their ability to work. This section will provide a detailed analysis of my country’s current pension insurance system, including its coverage, payment methods, benefit calculations, and reform measures in recent years. By having an in-depth understanding of the pension insurance system, we can better plan our personal retirement life and contribute to the sustainable development of society.

3.1 Overview of Japan’s pension insurance system

Japan’s pension insurance system is a multi-layered, comprehensive social security network designed to provide all citizens with basic living security after retirement. This system mainly consists of two pillars: National Pension (Basic Pension) and Employees’ Pension Insurance. These two systems complement each other and together form Japan’s unique “two-tier structure” pension insurance system.

As the first layer, the National Pension provides basic pension security for all Japanese residents. It is a universal insurance system. Regardless of occupation or income level, all Japanese residents aged 20 to 59 must participate. Employees’ pension insurance constitutes the second layer, mainly for corporate employees and civil servants, providing additional income-related pension benefits.

This two-tiered structure is designed to balance generalizability and individual differences. The National Pension ensures that every citizen can receive basic pension security, while the Welfare Pension provides additional pensions based on an individual’s working income to better maintain the standard of living before retirement.

In addition, Japan also encourages individuals and companies to participate in private pension plans, such as corporate annuities and personal annuity insurance, as a supplement to public pension insurance. This forms a “three-pillar” comprehensive pension security system, which effectively disperses the social risks brought by the aging population.

3.2 National Pension (Basic Pension)

The National Pension, also known as the Basic Pension, is the cornerstone of Japan’s pension insurance system. It was established to provide the most basic pension security for all citizens, embodying the principle of universal social welfare.

The insured objects include three categories of people: the first category of insured persons (self-employed persons, students, unemployed, etc.), the second category of insured persons (those insured by employees’ pensions), and the third category of insured persons (the third category of insured persons). Spouses of Category II insured persons). This classification ensures that almost all Japanese residents are covered by the National Pension.

The funding sources of the National Pension mainly include individual contributions, state subsidies and fund investment income. The first category of insured persons is required to pay a fixed amount of insurance premiums by themselves, while the insurance premiums of the second and third categories of insured persons are paid through other methods or are exempted.

The National Pension provides various types of annuity benefits, including basic pension for the elderly, basic disability pension and basic pension for survivors. Among them, the old-age basic annuity is the most basic form of payment. It usually starts to be received at the age of 65, but you can also choose to receive it in advance or postpone it, and adjust the payment amount accordingly.

In order to cope with the aging of the population and financial pressure, the Japanese government has carried out multiple reforms to the national pension system in recent years, including gradually raising the age of benefits and adjusting benefit levels. Despite this, the National Pension is still an indispensable part of Japan’s social security system and plays an important role in maintaining social stability and ensuring citizens’ basic life.

3.3 Employees’ Pension Insurance

Employees’ pension insurance is the second layer of Japan’s pension insurance system, mainly for corporate employees and civil servants. It was established to provide insured persons with additional pension benefits related to their working income to better maintain their pre-retirement living standards.

The insured objects include employees working in legal entities or individual enterprises of a certain size. It is worth noting that even foreigners must participate in employee pension insurance as long as they work for a Japanese company and meet certain conditions.

The insurance premiums for the employee pension are borne jointly by the employer and the employee, and are paid according to a certain proportion of the employee’s salary. This shared commitment mechanism reflects the employer’s social responsibility and also increases pension accumulation. Insurance rates are adjusted periodically based on socioeconomic conditions to ensure the sustainability of the system.

The benefits provided by the Welfare Pension mainly include the Old-age Welfare Pension, Disability Welfare Pension and Survivor’s Welfare Pension. Among them, the old-age welfare pension is usually paid together with the national pension (basic pension) and constitutes the main source of income for retirees. The payment amount of the welfare pension is closely related to the insured’s working years and average salary level, which reflects the principle of paying more and getting more.

In recent years, in order to cope with the challenges brought by the aging population and low fertility rate, the Japanese government has carried out a series of reforms to the welfare pension system. These reforms include gradually raising the receiving age, introducing a macroeconomic sliding mechanism to adjust benefit levels, and expanding coverage. These measures are designed to maintain the financial balance of the system and ensure long-term sustainability.

Despite facing many challenges, employees’ pension insurance is still an important part of Japan’s social security system, providing reliable retirement security for tens of millions of Japanese employees. Together with the National Pension, it constitutes Japan’s unique “two-tier structure” pension insurance system, which plays a vital role in ensuring the quality of life of the elderly and maintaining social stability.

3.4 Types of pensions and conditions for receiving them

Japan’s pension system offers many types of annuities to meet the needs of different situations. The main types of pensions include old-age pensions, disability pensions and survivors’ pensions. Each type is divided into two levels: basic annuity and employee pension.

Old-age annuity is the most common type of pension, including old-age basic annuity and old-age welfare annuity. Receipt conditions usually include:

• Age requirement: In principle, you must be 65 years old. However, you can choose to start receiving it at any age between 60 and 70 years old, and adjust the benefit amount accordingly.
• Payment period: In principle, insurance premiums need to be paid for 10 years or more. Prior to April 2017, 25 years was required, but this has been reduced to 10 years in order to expand coverage.
• Nationality requirements: Japanese nationality is not required, but you must have legal residence status in Japan.

Disability pensions are available to people who are disabled due to injury or illness, including basic disability pensions and disability employees’ pensions. The main conditions for receiving include:

• Degree of disability: The legal disability level must be met.
• Payment requirements: Insurance premiums are being paid when the disability occurs, or there are sufficient payment records within a certain period in the past.
• Age limit: There is no clear age limit, you can apply as long as you meet other conditions.

Survivors’ annuity provides living security for the survivors of the deceased insured person, including survivors’ basic annuity and survivors’ welfare annuity. The main conditions for receiving include:

• Relationship Requirement: Must be the insured’s spouse, child or, in certain circumstances, parent.
• Payment requirements: The deceased insured must have sufficient payment records during his lifetime.
• Age and status requirements: Spouses usually need to be over 55 years old (gradually increasing to 65 years old), and children need to be under 18 years old or have specific disabilities.

It’s worth noting that these annuity types may be stacked. For example, a person may receive the old-age basic pension and the old-age welfare pension at the same time. In addition, Japan also has various supplementary annuities, such as widow’s annuity, orphan’s annuity, etc., to cater for the needs of special groups.

When receiving a pension, you need to submit an application to a pension office. During the application process, you need to provide proof of identity, payment records and other relevant documents. For Japanese annuitants living overseas, they are also required to submit proof of survival regularly.

With the changes in the socio-economic environment, the Japanese government is constantly adjusting the conditions and payment levels of pensions to balance the sustainability of the system and the level of protection for insured persons. Understanding these conditions and regulations is crucial to properly planning for retirement.

3.5 Insurance premium calculation method and payment method

The premium calculation method and payment method of Japanese pension insurance vary according to different insurance types. The following details the specific practices of National Pension and Employees’ Pension Insurance:

Insurance premiums for National Pension (Basic Pension):

• Calculation method: The national pension adopts a fixed amount system. All Category 1 insured persons pay the same monthly premium, regardless of personal income differences.
• Payment amount: The monthly insurance premium for 2023 is 16,520 yen. This amount will be adjusted annually based on price and wage levels.
• Payment method: You can choose monthly payment, half-year prepayment or full-year prepayment. Certain discounts are available for prepayment.
• Payment channels: Payment can be made through bank transfer, convenience store payment, credit card payment, etc.
• Reduction and exemption policy: For special groups such as low-income people and students, there is an insurance premium reduction or deferment system.

Premiums for employee pension insurance:

• Calculation method: Adopt a proportional system linked to income. The insurance premium is calculated based on a certain proportion of the insured’s standard monthly remuneration and the standard reward amount.
• Payment ratio: The insurance rate in 2023 is 18.3% (including the employees’ pension insurance premium and the basic part of the national pension).
• Payment method: The employer and the employee each bear 50%. For example, if the total rate is 18.3%, the employer and employee each contribute 9.15%.
• Payment base: standard monthly remuneration, divided into 30 levels based on salary income, with a lower monthly limit of 88,000 yen and an upper limit of 650,000 yen; standard reward amount, calculated based on annual bonuses and other temporary income, with an upper limit of 150 per year Ten thousand yen.
• Payment method: Usually, the employer deducts the employee’s portion when paying wages, and pays it to the Social Security Department together with the employer’s portion.
• Payment deadline: In principle, payment should be made before the end of the next month.

In addition, there are some special situations that need to be noted:

• For the third category of insured persons (spouse of employees’ pension insured persons), individuals are not required to pay national pension insurance premiums.
• For those who join multiple annuity systems at the same time, there are special premium calculation and payment regulations.
• For foreigners, if they come from a country that has a social security agreement with Japan, special insurance premium payment regulations may apply.

The Japanese government has also provided a variety of convenient measures to simplify the payment process, such as online declaration systems, automatic transfer services, etc. At the same time, in order to ensure the fairness and sustainability of the system, there are corresponding recovery and penalty mechanisms for insurance premium arrears.

Understanding and complying with these insurance premium calculation and payment regulations is not only a legal obligation, but also an important guarantee for ensuring that you can receive a full pension in the future. For individuals and businesses, rational planning of insurance premium expenditures and full use of various exemption and reduction policies can optimize the use of funds while protecting rights and interests.

3.6 Calculation method of pension

The calculation method of Japan’s pension is relatively complicated because it needs to consider multiple factors, including insurance type, payment years, average income level, etc. The following details the calculation methods of the National Pension (Basic Pension) and Employees’ Pension:

Calculation of National Pension (Basic Pension)

• Basic formula: Full national pension = fixed amount × (actual number of payment months ÷ 480)
• Fixed amount: 781,700 yen/year in 2023
• Number of payment months: up to 40 years (480 months)
• Adjustment factors: possible adjustments according to the macroeconomic sliding mechanism

For example, if a person pays for 40 years (480 months), the full amount of national pension that can be received in 2023 is 781,700 yen/year. If you pay for 30 years (360 months), you can receive: 781,700 × (360 ÷ 480) = 586,275 yen/year.

Calculation of welfare pension

The calculation of employees’ pension is more complicated and mainly includes two parts: fixed part and remuneration proportion part.

• Fixed portion: Same as the National Pension, 781,700 yen/year (full amount) in 2023
• The calculation formula of the remuneration proportion part: (A × 5.481 ÷ 1000 + B × 5.481 ÷ 1000) × Number of payment months ÷ 12 )；in: A = Average monthly standard compensation before March 2003；B = average standard monthly compensation after April 2003.
• Number of payment months: considering the actual payment period, the upper limit is 40 years (480 months).
• Special measures during childbirth and parenting: For insured persons born after April 2, 1961, additional pension calculation benefits can be obtained within a certain period after the birth of the child.

Additionally, the following factors need to be considered:

• Price adjustment: Adjusted based on changes in the Consumer Price Index
• Macroeconomic slide: adjusted for factors such as a smaller working population and longer life expectancy
• Adjustment of early or delayed payment: If you choose to receive early payment between the ages of 60 and 65, it will be reduced by 0.4% for each month in advance; if you choose to delay your payment between the ages of 65 and 70, it will increase by 0.7% for each month of delay.
• Pension adjustment for the working elderly: If you continue to work and have income during the pension period, the pension may be adjusted based on the income level.

It should be noted that due to frequent reforms in the Japanese pension system, specific calculation parameters and methods may change. For example, Japan has introduced a “macroeconomic sliding mechanism” in recent years to dynamically adjust pension benefit levels based on changes in demographic structure and economic growth.

In addition, for people with overseas living experience, their pension calculation may also need to take into account the relevant provisions of the social security agreement.

To sum up , the Japanese pension calculation method embodies the principles of “pay more, get more” and “income correlation”, while balancing the sustainability and fairness of the system through various adjustment mechanisms. Understanding these calculation methods can help individuals better plan their retirement life and also help understand the overall design concept of the Japanese pension insurance system.

3.7 Pension issues for foreigners (including lump sum withdrawal)

As more and more foreigners choose to work and live in Japan, the Japanese government is faced with the dual challenge of maintaining the integrity of its pension insurance system while adapting to the reality of international labor mobility. This issue not only involves the protection of personal rights and interests, but also relates to the long-term stability and economic development of Japanese society.

Japan’s pension insurance system adopts the principle of equal treatment for foreigners. As long as foreigners living in Japan meet the corresponding conditions, such as age and working status, they must join Japan’s pension insurance system. This includes two main parts: National Pension and Welfare Pension. The National Pension is a basic pension insurance for all residents aged 20 to 59, while the Employees’ Pension is an occupational pension insurance for employees working in specific companies. This system design ensures the basic pension security for foreign residents in Japan, while also maintaining the fairness of the entire social security system.

For foreigners to receive Japanese pensions, they need to meet several basic conditions. First, the period for paying insurance premiums must be 10 years (including the exemption period). This requirement reflects the long-term and cumulative nature of Japan’s pension system. Secondly, the applicant must reach the specified receiving age, which is usually 65 years old. This age limit takes into account the reality of Japan’s aging population and is intended to balance the sustainability of the pension system. Finally, when applying for a pension, foreigners must have valid Japanese residency status. This provision not only ensures the reasonable distribution of pension benefits, but also encourages foreigners to stay in Japan for a long time and integrate into society.

In order to cope with the challenges brought about by internationalization, the Japanese government actively signs social security agreements with other countries. These agreements mainly address three core issues: avoidance of double contributions, cumulative calculation of insurance periods, and cross-border pension payments. Avoiding double contributions means that paying social insurance premiums in one country can eliminate the obligation to pay in another country, which greatly reduces the financial burden of multinational workers. The cumulative calculation of the insurance period allows the payment periods in the agreement countries to be combined for calculation, which helps to meet the minimum payment period requirements and protects the rights and interests of transnational workers. Cross-border payments allow pension beneficiaries to receive their due pensions while living abroad, increasing the flexibility and applicability of the system.

For foreigners who have lived in Japan for a short period of time, Japan has specially established a lump sum withdrawal system. The main features of this system include: First, to qualify, you need to pay employees’ pension insurance premiums or national pension insurance premiums for at least 6 months. This threshold not only takes into account the needs of short-term workers, but also ensures the rationality of the system. Secondly, the application deadline is within 2 years after leaving Japan. This time limit not only gives sufficient time to apply, but also avoids long-term pending situations. Thirdly, the amount of the lump sum refund is calculated based on the number of payment months and average salary, and a maximum one-time payment equivalent to three years of payment can be received. This calculation method compensates to a certain extent for short-term workers who cannot enjoy full pension benefits. However, it is important to note that once you receive the lump sum, the corresponding payment record will be cleared, which may affect your future pension rights in Japan. Therefore, foreigners need to consider carefully when applying for a lump sum withdrawal and weigh the short-term benefits and long-term protection.

For foreigners who choose to live permanently in Japan, their pension benefits are basically the same as those for Japanese nationals. This reflects Japanese society’s tolerance and equal treatment of long-term foreigners. Such foreign residents need to consider long-term retirement planning and make full use of the national pension and employee pension systems. They must not only pay attention to the current payment situation, but also consider possible future policy changes and economic conditions, and make comprehensive financial plans.

To help foreigners better understand and utilize the pension system, the Japanese government provides a variety of multilingual services. This includes multilingual promotional materials and websites, setting up foreign consultation windows in major cities, and providing telephone consultation services in English and other foreign languages. These measures significantly reduce language barriers and make it easier for foreign residents to access relevant information and assistance.

As international talent flows become increasingly frequent, Japan is considering further improving its pension policy for foreigners. This includes expanding the coverage of social security agreements so that citizens of more countries can enjoy the conveniences brought by the agreements; simplifying cross-border pension transfer procedures and reducing administrative obstacles; enhancing the international compatibility of the pension system to make it more adaptable to globalization needs. These measures will not only help attract international talents, but also help improve the international competitiveness of Japan’s pension system.

For foreigners working and living in Japan, it is important to have a thorough understanding of and rational use of these policies and systems. This is not only related to personal retirement security, but also to the overall planning of cross-border work and life. Foreign residents need to weigh short-term and long-term interests, consider possible future international mobility, and make the choice that best suits their circumstances. At the same time, for foreigners considering long-term development in Japan, an in-depth understanding of Japan’s pension insurance system and corresponding financial planning will help ensure future quality of life and economic security.

In addition, foreigners need to pay attention to some special regulations of Japan’s pension system. For example, for foreigners who work in Japan for a short period of time, there may be insurance premium exemption or refund policies; for those who have worked in multiple countries, they need to consider how to maximize the use of social security agreements in each country; for those who plan to return to their country after retirement, You need to understand the international pension payment procedures and possible tax implications.

3.8 Social security agreements between Japan and other countries

Japan is actively promoting the signing of social security agreements with other countries. This move not only reflects Japan’s adaptation to the new trend of international labor mobility, but also demonstrates its efforts in safeguarding the rights and interests of transnational workers. The signing and implementation of these agreements have a profound impact on promoting international economic cooperation, talent exchanges, and protecting individual social security rights and interests.

The main purposes of social security agreements are manifold. First, it aims to avoid the problem of double payment. In today’s globalized world, cross-border work has become the norm. Without these agreements, many people may be faced with paying social security premiums in two or more countries at the same time, which will undoubtedly increase the financial burden on individuals and businesses. Secondly, these agreements strive to protect the rights and interests of transnational workers. By coordinating the social security systems of different countries, we ensure that individuals will not lose their due social security benefits due to system differences while working abroad. Finally, these agreements inject vitality into the development of the global economy by removing barriers to social security and encouraging and facilitating the flow of international talent.

The content of a social security agreement usually covers several key areas. The first is to clarify the scope of application of the agreement and specify which social insurance items are covered by the agreement, which usually include basic social security contents such as pensions, medical care, and work-related injuries. This clear scoping ensures precise implementation of the agreement. The second is the exemption provision, that is, participating in social insurance in one country can exempt you from the obligation to participate in insurance in another country. This provision directly solves the problem of double payment and greatly reduces the burden on multinational workers and enterprises. The third is the period accumulation provision, which allows the insurance periods in the two agreement countries to be accumulated to meet the payment conditions of certain social insurance benefits. This provision effectively protects the rights and interests of workers who frequently move between different countries. Finally, there is the cross-border payment arrangement, which ensures that individuals can still receive the social insurance benefits they deserve when living in the other country, which increases the flexibility and applicability of the social security system.

As of 2023, Japan has signed social security agreements with many countries, covering the world’s major economies and Japan’s important trading partners. In Europe, Japan has signed agreements with Germany, the United Kingdom, Belgium, France, the Netherlands, the Czech Republic, Spain, Ireland, Switzerland and other countries. The signing of these agreements reflects the close economic ties and personnel exchanges between Japan and European countries. In North America, Japan has signed agreements with the United States and Canada, which have played an important role in promoting economic cooperation and talent exchanges across the Pacific. In Oceania, Japan signed agreements with Australia and New Zealand, strengthening economic ties with these countries. In Asia, Japan has signed agreements with South Korea, China, India, the Philippines and other countries, which reflects Japan’s active role in regional economic cooperation in Asia. The establishment of these agreement networks not only facilitates talent exchanges between Japan and these countries, but also provides strong support for the global operations of Japanese companies.

The implementation effects of these social security agreements are multifaceted and far-reaching. First, they significantly reduce the burden on businesses. By avoiding double payment, enterprises’ transnational operating costs can be reduced, which not only improves the international competitiveness of enterprises, but also encourages more enterprises to participate in the international market. Secondly, these agreements effectively protect individual rights and interests. Transnational workers no longer lose social security rights due to changes in their work location, which increases the flexibility of career choices and provides more possibilities for personal career development. Furthermore, these agreements greatly facilitate international talent mobility by removing social security barriers. This is not only conducive to the global spread of knowledge and skills, but also injects new vitality into the economic development of various countries. Finally, the signing and implementation of these agreements have strengthened cooperation between Japan and other countries in the field of social security, deepened international exchanges, and helped to establish closer international relations.

The procedure for applying a social security agreement usually involves several key steps. The first is the application for a certificate. Transnational workers need to apply for an applicable certificate from the social insurance agency in their home country. This certificate is an important document to enjoy the benefits of the agreement. The second step is to submit a certificate to the country of work in order to be exempted from local social insurance payment obligations. This step ensures the implementation of the agreed benefits. When applying for social insurance benefits, individuals can provide proof of insurance participation in the other country to achieve period accrual. These procedures are designed to make the implementation of the agreement as simple and efficient as possible and to reduce administrative obstacles.

For some special circumstances, such as being dispatched to work in a third country, some agreements also make corresponding provisions. This reflects the agreement’s flexibility in dealing with complex international labor mobility patterns. For those who are employed in two countries at the same time, the agreement usually has special provisions to ensure that such workers can receive reasonable social security. The existence of these special provisions reflects the efforts of social security agreements to accommodate diverse work patterns.

Japan’s development trend in social security agreements is mainly reflected in several aspects. First, Japan is actively negotiating and signing social security agreements with more countries to further expand the agreement network. This reflects Japan’s ongoing efforts to build a global social security system. Secondly, based on implementation experience, Japan is constantly improving the terms of the agreement and optimizing the content of the agreement. This attitude of continuous improvement ensures that the Agreement can better adapt to the changing international situation. In addition, Japan is also promoting the transnational digital exchange and management of social security information. This trend reflects the important role of technological progress in simplifying administrative procedures and improving efficiency.

It is vital for individuals to fully understand and take advantage of these social security agreements. When planning to work cross-border, you should understand the contents of relevant agreements in advance, which will help you make better career planning. At the same time, it is also very important to properly keep insurance certificates and payment records. These documents may come in handy when applying for social insurance benefits in the future. In addition, timely application for applicable certificates and social insurance benefits in accordance with regulations can ensure that personal rights and interests are fully protected. For some complex situations, it is recommended to seek professional consultation from relevant agencies to avoid unnecessary losses caused by misunderstanding the content of the agreement.

The social security agreements between Japan and other countries are more than simple bilateral agreements. Together, they constitute a complex and organic international social security network. This network reflects the joint efforts of governments across the world to coordinate social security systems to adapt to new trends in international labor mobility in the context of globalization. These agreements not only protect individual rights and interests, but also create a more favorable environment for enterprises to operate across borders, while promoting international economic cooperation and cultural exchanges.

With the further deepening of international exchanges, it is expected that such agreements will cover more countries in the future and their content will become more comprehensive and detailed. More special provisions for emerging forms of employment (e.g. remote work, freelancing) are likely to emerge to adapt to the changing labor market. At the same time, the application of digital technology in the implementation and management of the agreement is likely to be further strengthened, simplifying procedures and improving efficiency.

For individuals with cross-border work plans and companies that are currently operating or planning to operate cross-border, fully understanding and utilizing these social security agreements will help to better plan careers and manage human resources. Individuals can make smarter career choices based on these agreements, and companies can use these agreements to optimize global talent allocation strategies. At the same time, government departments also need to continue to pay attention to the implementation effects of the agreement and adjust policies in a timely manner to ensure that the agreement can maximize its role in promoting international exchanges and protecting rights and interests.

Detailed explanation of the unemployment insurance system

The unemployment insurance system is an important part of the social security system and aims to provide basic living security and re-employment support for unemployed people. This section will introduce in detail the basic concepts of unemployment insurance, insured objects, payment standards, benefits receiving conditions and standards and other key contents. Through an in-depth analysis of the operating mechanism and related policies of the unemployment insurance system, it helps readers fully understand this important social security measure, understand their own rights and interests, and be able to correctly apply for and use unemployment insurance benefits when needed.

4.1 Overview of employment insurance system

The employment insurance system is an important part of Japan’s social security system, aiming to provide temporary economic support for the unemployed while promoting employment stability and career development. The system was first introduced in 1947 and has been revised and improved many times to form the current comprehensive unemployment security system.

The main functions of employment insurance can be summarized in three aspects: First, it provides basic living security for the unemployed, helps the unemployed maintain their basic living standards through the payment of unemployment insurance benefits, and alleviates the economic pressure caused by sudden job loss. The second is to promote re-employment and help the unemployed return to work as soon as possible through various employment support measures and vocational training projects. The third is to prevent unemployment. By providing various subsidies and support to enterprises, we encourage enterprises to take measures to maintain employment stability and prevent large-scale layoffs.

The operation of this system is based on the principle of “social mutual assistance”, with employers, employees and the government sharing the responsibilities. Employers and employees pay insurance premiums in prescribed proportions, and the government provides necessary financial support and management guarantees. This tripartite sharing model not only ensures the sustainability of the system, but also embodies the concept of social mutual assistance.

The employment insurance system has a wide coverage, including most types of employees, such as regular employees, part-time workers (provided certain conditions are met), etc. However, there are some exceptions. For example, certain groups of civil servants may not be covered by this system because they may have special protection systems.

4.2 Insurance conditions and procedures

Participating in employment insurance is a legal obligation for most employees and is also a prerequisite for receiving unemployment insurance. The establishment of insurance conditions and procedures aims to ensure the universality and fairness of the system, while taking into account the characteristics of different forms of employment.

For full-time employees, employment insurance is in principle required as long as they are employed. For part-time employees (such as part-time workers), the following conditions need to be met to be insured: the working hours per week exceed 20 hours, and the expected employment period is more than 31 days. This provision takes into account the work characteristics of part-time employees and seeks a balance between protecting rights and interests and system sustainability.

The insurance enrollment procedures are mainly handled by the employer. When an employer hires a new employee, he or she needs to submit an employment insurance insured qualification certificate to the local public employment security office (i.e. “Hello Work”) immediately after the employee joins the job. This document contains important information such as the employee’s basic information, employment start date, working hours, and more. After the Public Occupational Security Office audits, an employment insurance insured certificate will be issued to the employer, and the employer must hand over the certificate to the employee for safekeeping.

Foreign employees can also participate in employment insurance as long as they meet the above conditions and have legal residence status. This reflects the inclusiveness of Japan’s employment insurance system, which provides foreigners working in Japan with the same protection as Japanese nationals.

Under certain special circumstances, you may not be eligible for insurance even if you meet the basic conditions. For example, in principle, people who are newly employed after the age of 65 cannot participate in employment insurance. This provision takes into account Japan’s retirement system and the employment characteristics of the elderly.

4.3 Calculation and payment of insurance premiums

The calculation and payment of employment insurance premiums are the economic basis for the operation of the entire system. The setting of insurance premiums follows the principle of “affordability”, that is, the amount of contributions is determined based on the employee’s salary and income level. This design not only ensures the sustainability of the system, but also reflects social equity.

Insurance rates are regularly adjusted by the government based on factors such as economic conditions and unemployment rates. At present, the employment insurance rate for general enterprises is 0.9% of the employee’s total salary, of which the employer bears 0.6% and the employee bears 0.3%. For some special industries (such as construction), slightly higher rates may be applied taking into account their employment characteristics.

The basis for calculating insurance premiums is the employee’s total salary, including basic salary, various allowances and bonuses. For part-time employees, the insurance premium is also calculated based on actual salary income, but due to shorter working hours, the actual amount paid may be lower.

The payment of insurance premiums is mainly the responsibility of the employer. The employer is required to deduct the employee’s portion from the employee’s salary when paying wages each month, and pay the portion to the Social Security Department together with the employer’s portion in the following month. This “source collection” (i.e. source deduction) method simplifies the payment process and improves collection efficiency.

For newly established businesses or newly hired employees, the first month’s premium may require special calculations. If an employee joins or leaves the company mid-month, the premium for that month is prorated based on the number of actual days worked.

Even if an employee is on leave (such as maternity leave, parental leave, etc.), as long as the employment relationship still exists, in principle, insurance premiums are still required. This ensures that employees remain eligible for coverage under special circumstances.

In order to ensure that insurance premiums are paid in full and on time, the law stipulates penalties for defaulting on insurance premiums. At the same time, the government has also established a certain deferment mechanism for companies that have difficulty paying insurance premiums on time due to operating difficulties, which reflects the humanity and flexibility of the system.

4.4 Application conditions and procedures for unemployment insurance benefits

Unemployment insurance is the core protection item of the employment insurance system. Its application conditions and procedures are designed to ensure that unemployed people who truly need help can receive timely support while preventing abuse of the system.

The basic requirements for applying for unemployment insurance benefits include:

• Applicants must have valid employment insurance insured status.
• Must have at least 12 months of payment history within the two years before unemployment. For those who are unemployed due to involuntary reasons such as bankruptcy or layoff, this requirement may be relaxed to 6 months.
• Applicants must have the willingness and ability to be re-employed and actively look for work.
• The reason for unemployment cannot be due to serious negligence or voluntary resignation (except in special circumstances).
• The application process typically includes the following steps:
• After becoming unemployed, applicants must go to the public employment security office in their place of residence as soon as possible to register for employment.
• Attend the initial orientation session to learn about the rules for receiving unemployment insurance benefits and job search activity requirements.
• Report your job search activities to the public employment security office regularly (usually every 4 weeks).
• After being reviewed and meeting the conditions, you will begin to receive unemployment insurance benefits.

Unemployment insurance benefits are not automatically paid, and applicants need to actively apply. There is usually a 7-day waiting period from leaving your job to receiving your first unemployment insurance benefit, which is called the “waiting period.” In addition, those who voluntarily leave may need to wait an additional three months, which is called the “benefit limitation period.” These provisions are intended to prevent abuse of the system and encourage stable employment.

During the application process, the staff of the Public Employment Security Office will strictly review the application qualifications, including verifying the reasons for leaving the job and confirming the willingness to apply for a job. If you are found to have made a false application or received it improperly, you may face severe penalties, including the recovery of paid insurance benefits and legal sanctions.

4.5 Calculation method and payment period of unemployment insurance benefits

The calculation and payment of unemployment insurance benefits are the core link of the entire system and are directly related to the basic living security of the unemployed. The design of the calculation method and payment period must not only take into account the full protection of the unemployed, but also take into account the sustainability of the system and incentives for re-employment.

The basic calculation formula of unemployment insurance benefits is: daily unemployment insurance benefits = average daily salary in the 6 months before resignation × 50-80% (the specific proportion depends on age and reason for resignation). This calculation method takes into account the actual income level of individuals, and at the same time ensures basic living security and system fairness by setting upper and lower limits.

Specifically, the calculation process can be divided into the following steps:

Calculate the total income (including salary, bonus, etc.) in the 6 months before resignation.

Divide total earnings by 180 days to find the average daily wage.

The benefit ratio is determined based on age and reason for leaving:

• Under 30 years old: 50%
• 30-44 years old: 55%
• 45-59 years old: 60%
• 60-64 years old: 65%
• For those who are unemployed due to involuntary reasons such as corporate bankruptcy or layoffs, the benefit rate may be increased to 80%.

Multiply the average daily wage by the benefit rate to get the daily unemployment insurance benefit amount.

The payment period of unemployment insurance benefits mainly depends on the following factors:

• Age of the insured person
• The number of years to pay insurance premiums
• Reason for resignation (voluntary or involuntary)
• Are there any special circumstances such as employment difficulties

Generally, the issuance period is between 90 days and 360 days. For example, unemployed persons over 45 years old with a payment period of more than 5 years can receive unemployment insurance benefits for up to 330 days if they are unemployed due to involuntary reasons such as company bankruptcy. For young people who voluntarily resign, the payment period may be only 90 days.

Receiving unemployment insurance benefits is not a one-time payment, but requires regular (usually every 4 weeks) confirmation of job search activities at the public employment security office. This design aims to encourage the unemployed to actively look for jobs and achieve re-employment as soon as possible.

In addition, if an unemployed person finds a new job while receiving benefits, all remaining unemployment insurance benefits will not be cancelled. Instead, part of the unclaimed amount can be converted into “reemployment payments” as a reward for prompt reemployment. This design effectively balances unemployment protection and employment incentives.

4.6 Other employment insurance-related subsidies and assistance

In addition to basic unemployment insurance benefits, the employment insurance system also provides a series of subsidies and assistance measures aimed at promoting employment stability, supporting vocational ability development, and providing additional protection for special groups. These measures reflect the comprehensiveness and forward-looking nature of the system, which not only focuses on the current unemployment problem, but also strives to prevent unemployment and improve the overall quality of the labor market.

Subsidy related to employment stability: Employment adjustment subsidy. When a company has to reduce production due to operating difficulties, if it takes measures such as suspension of operations, education and training, or job sharing to maintain employment, you can apply for this subsidy. This helps prevent large-scale layoffs and maintain social stability. The employment development subsidy for specific job seekers provides subsidies to companies that hire specific groups (such as the elderly, disabled people, etc.) and encourages companies to create job opportunities for these groups who have difficulty finding employment.

Subsidies related to professional ability development: Talent development support grants support enterprises to provide vocational training for employees and improve employees’ professional skills and adaptability. This is not only beneficial to employees’ personal development, but also enhances the competitiveness of enterprises. Education and training benefits provide tuition subsidies to employed or unemployed people who participate in designated education and training courses to encourage lifelong learning and self-improvement.

Re-employment support measures: Re-employment assistance. If the unemployed find a new job quickly while receiving unemployment insurance benefits, they can receive a certain amount of incentives. This design is intended to motivate the unemployed to actively look for work. Employment promotion settlement subsidy provides relocation cost subsidies to unemployed people who need to move in order to accept employment, reducing geographical restrictions on employment.

Special group assistance, continued employment benefits for the elderly: For the elderly aged 60-65 who continue to work but their wages have been reduced, partial wage subsidies are provided to encourage the elderly to continue to be employed. Childcare Leave Benefit provides a partial wage subsidy for employees who take leave to care for infants and young children to support the balance between work and family. Nursing care leave benefits provide subsidies to employees who take leave to care for family members who require long-term care, reducing the burden on families.

Entrepreneurship Support : Entrepreneurship Support Fund provides initial financial support and consulting services to unemployed people who plan to start a business, encourages self-employment, and creates job opportunities.

Applications for these subsidies and assistance measures generally need to meet specific conditions and are made through public employment security offices or agencies designated by the Ministry of Health, Labor and Welfare. The application process may require the provision of detailed supporting documents and review by relevant departments.

Of course, these measures are not static, but will be continuously adjusted and optimized according to the economic situation and social needs. For example, during the period of economic recession, support for enterprises to maintain employment may be increased; during the period of industrial restructuring, support for career change training may be increased.

These supplementary measures have greatly expanded the functions of the employment insurance system, developing it from simple unemployment protection to a comprehensive employment support and labor market adjustment mechanism, playing an important role in promoting employment, improving labor quality, and supporting vulnerable groups.

4.7 Special provisions for unemployment insurance for foreigners

With the deepening of globalization and the internationalization of Japan’s labor market, the employment of foreigners in Japan has become increasingly common. In order to adapt to this trend, Japan’s employment insurance system has made some special provisions for foreigners, which not only protects the rights and interests of foreign workers, but also takes into account their special circumstances.

• Eligibility for insurance: In principle, foreigners legally working in Japan have the same qualifications for employment insurance as Japanese nationals. As long as the basic conditions for working hours and employment period are met (more than 20 hours of work per week and more than 31 days of expected employment period), foreigners must participate in employment insurance. This provision reflects the inclusive and non-discriminatory principles of Japan’s employment system.
• Impact of status of residence: A foreigner’s status of residence has an important impact on his participation in insurance and his receipt of unemployment insurance benefits. Only foreigners with a status of residence that allows work (such as technical intern training, specified skills, permanent residents, etc.) can participate in the insurance. If your period of stay expires or your status of residence is changed to a type that does not allow you to work, you will no longer be able to receive unemployment insurance benefits. This requires foreign workers to pay special attention to their status of residence.
• Special post-employment considerations: There are special rules for foreigners who plan to leave Japan. If you leave Japan immediately after resigning, you can apply for a one-time payment of the remaining unemployment insurance benefits, which is called a “one-time separation ticket.” However, after choosing this method, you will no longer be able to enjoy other employment support services. This provision takes into account the situation where foreign workers may need to return to their home country for various reasons.
• Language support: Considering that language may be a barrier for foreigners to understand and use the employment insurance system, many public employment security offices offer multilingual services. Public employment security offices in some big cities even have special consultation windows for foreigners, providing consultation services in English, Chinese, Portuguese and other languages.
• Impact of international agreements: Japan has signed social security agreements with some countries, which may affect the employment insurance rights of foreigners. For example, some agreements allow work experience in the agreement countries to be accumulated into the insurance period, which is particularly beneficial for international talents who often move between different countries.
• Impact of re-entry permit: Foreigners who leave Japan with a re-entry permit can continue to receive unemployment insurance benefits if they return to Japan within the validity period of the permit. This provides foreigners with some flexibility, allowing them to leave Japan for a short period of time while unemployed without losing their insurance rights.
• Special Considerations for Job Search Activities: For unemployed foreigners with limited Japanese language proficiency, the Public Employment Security Office may have some special considerations when evaluating their job search activities. For example, their job search activity on a native language job search website may be accepted as proof of valid job search.
• Special circumstances of technical intern trainees: Although technical intern trainees also participate in employment insurance, since their purpose in Japan is mainly to learn skills, there may be some special regulations in applying for and receiving unemployment insurance benefits. For example, if technical intern training is interrupted due to reasons with the host company, the intern may be eligible to apply for unemployment insurance benefits.
• Re-employment support for returning to the country: For unemployed foreigners who plan to return to their country to find work, some public employment security offices provide special re-employment support services for returning to the country, such as providing job market information in the home country and assisting in the preparation of foreign language resumes.
• Cultural adaptability considerations: When providing employment consultation and vocational training, the cultural background and professional habits of foreigners may be taken into consideration to provide more personalized services.

These special provisions and considerations reflect Japan’s employment insurance system’s efforts to respond to the internationalization of the labor market. However, as the number and types of foreign workers increase, these regulations may need to be further improved and adjusted. For example, it may be necessary to consider how to better accommodate new forms of employment such as flexible employment and remote work, and how to further simplify the process for foreigners to use employment insurance services.

To sum up , the special provisions on unemployment insurance for foreigners not only reflect the protection of the rights and interests of foreign workers, but also reflect the need to manage foreign labor. The implementation and continuous improvement of these regulations are of great significance to promoting the internationalization of the Japanese labor market and attracting and retaining international talents.

Detailed explanation of work-related injury insurance system

The work-related injury insurance system is an important part of Japan’s social security system and aims to provide comprehensive protection for workers and their families who suffer injury, illness, disability or death due to work-related reasons. This section will provide a detailed introduction to various aspects of the Japanese work-related injury insurance system, including its overview, coverage, premium calculation, work-related injury recognition standards, compensation items, rehabilitation benefits, and special considerations for foreign workers. By in-depth understanding of this system, we can better understand how Japan protects the rights and interests of workers and maintains social fairness and justice.

Workers’ accident compensation insurance, referred to as work-related injury insurance, began in 1947 and is one of the core contents of Japan’s social security system. The system not only covers direct medical expenses, but also includes living allowances during recovery, disability compensation and many other benefits. As a compulsory insurance, work-related injury insurance requires full premium payment by the employer, embodying the concept of social responsibility and the protection of workers’ rights and interests. With the development of social economy, the work-related injury insurance system has been continuously improved, its coverage has gradually expanded, and the level of protection has continued to improve. In recent years, the Japanese government has also formulated corresponding work-related injury insurance policies for emerging occupations and special working environments to adapt to the changing needs of the labor market.

Worker’s compensation insurance has a wide range of coverage, covering employees in almost all industries. According to the Workers’ Accident Compensation Insurance Law, all institutions that employ more than one worker, regardless of their size or nature of business, must participate in work-related injury insurance for their employees. Insured objects include regular employees, temporary workers, part-time workers, and even self-employed persons under certain conditions. It is worth noting that in recent years, the Japanese government has expanded the coverage of work-related injury insurance and included some non-traditional employment forms into the security system. For example, workers in emerging industries such as online ride-hailing and express delivery, as well as telecommuters working from home, can enjoy work-related injury insurance benefits under certain conditions. This policy change reflects the Japanese government’s positive response to changes in the labor market.

Work-related injury insurance premiums are fully borne by the employer and may not be deducted from employees’ wages. Insurance rates vary based on the hazard level of the industry, usually ranging from 0.25% to 8.8%. It is calculated by multiplying the employee’s total salary by the corresponding insurance rate. The Ministry of Health, Labor and Welfare of Japan regularly adjusts insurance rates based on the incidence of work-related injuries and compensation status in various industries. Companies with frequent workplace injuries may be charged additional insurance premiums; conversely, companies with good safety records may receive discounts on insurance rates. This floating rate mechanism is designed to encourage companies to strengthen production safety management and reduce the incidence of work-related injuries. The payment of insurance premiums usually adopts an annual declaration system. Employers are required to declare the total wages of the previous year and the estimated total wages of the current year to the local Labor Standards Supervision Office before the end of April each year, and pay insurance premiums accordingly.

The identification of work-related injuries is the core part of the work-related injury insurance system and involves whether insurance compensation can be obtained. Japan’s work-related injury recognition standards mainly include work relatedness, time and place, scope of reasonable behavior, etc. The work-related injury recognition process usually begins with an application from the employee or his representative to the Labor Standards Inspection Office. The Supervision Office will conduct an investigation and collect relevant evidence, such as medical diagnosis certificates, accident reports, etc. In complex or controversial cases, a committee of experts may be convened to discuss the matter. The final decision is made by the Labor Standards Inspection Office on whether to classify the injury as a work-related injury. It is worth noting that in recent years, Japan has also made some new developments in the identification of work-related injuries. For example, the identification standards for karoshi (sudden death caused by overwork) and work-related mental illness have been relaxed, reflecting the focus on health issues in the modern workplace.

The compensation items of work-related injury insurance are comprehensive and designed to provide all-round protection for injured employees. The main compensation items include medical compensation, leave of absence compensation, disability compensation, survivor compensation, nursing compensation and secondary health diagnosis and other benefits. Benefits are usually calculated based on the employee’s average salary, taking into account factors such as the degree of disability and need for care. The Japanese government regularly adjusts compensation standards based on price changes and living standards to ensure the actual value of work-related injury insurance benefits.

Work-related injury insurance not only covers medical expenses in the acute phase, but also provides comprehensive support for employees in their recovery process. During the period of medical treatment and recovery, employees can enjoy free medical treatment, continuous income protection, rehabilitation training, reimbursement of assistive device expenses, and career reconstruction support. In addition, Japan’s work-related injury insurance system also pays special attention to the mental health of employees. Mental illness caused by work stress is also covered by work-related injury insurance, and corresponding psychological consultation and treatment services are provided.

As the number of foreign workers in Japan increases, the Japanese government has also formulated some special policies for foreigners’ work-related injury insurance. These policies include the principle of equal treatment, language support, transnational medical cooperation, special cultural considerations, and legal assistance. Foreign employees enjoy the same rights to work-related injury insurance as Japanese employees. During the process of reporting and handling work-related injuries, multilingual services are provided to ensure that language does not become a barrier. For foreign employees who wish to return to their home countries for follow-up treatment, a corresponding cross-border medical expense reimbursement system has been developed. During the identification and recovery process of work-related injuries, the possible impact of different cultural backgrounds should be taken into consideration. In addition, the Japanese government has also strengthened the supervision of companies that employ foreign workers to ensure that these companies strictly abide by relevant laws and regulations on work-related injury insurance to prevent the rights and interests of foreign workers from being infringed.

Japan’s work-related injury insurance system embodies the great emphasis on workers’ rights and interests, and effectively responds to the changes and challenges of the modern social working environment through comprehensive safeguard measures and flexible policy adjustments. However, with the diversification of labor forms and the deepening of globalization, the work-related injury insurance system still needs to be continuously improved to better meet the needs of different groups. Through continuous improvement and innovation, Japan’s work-related injury insurance system will continue to play its important role in protecting workers and maintaining social stability.

Insurance guide for foreigners

With the deepening of globalization, more and more foreigners choose to work and live in Japan. In order to protect the rights and interests of these foreign residents and ensure the fairness and sustainability of the social security system, the Japanese government has formulated a series of social insurance participation policies for foreigners. This section will introduce in detail the social security obligations, insurance requirements, procedures and related precautions of foreigners in Japan, and provide a comprehensive insurance guide for foreigners in Japan.

Foreigners working in Japan, regardless of nationality, are in principle required to fulfill the same social security obligations as Japanese nationals. This includes participating in health insurance, nursing care insurance, annuity insurance, employment insurance, etc. This requirement not only reflects the universality and fairness of Japan’s social security system, but also ensures that foreign residents can receive appropriate medical and social welfare protection while living in Japan. It is worth noting that even foreigners working in Japan for a short period of time may be required to participate in certain social insurance. This approach is intended to prevent coverage gaps while also ensuring a level playing field in the labor market.

Insurance requirements for foreigners with different status of residence may be different. For example, foreigners holding the status of residence “Technical Intern Training” are required to participate in social insurance from the date of entry. For students with a “study abroad” status of residence, if they work off-campus for more than a certain number of hours, they also need to participate in social insurance. Foreigners holding work visas such as “Business Management” and “Technology, Humanities Knowledge, International Business” are usually required to participate in social insurance through their company. Long-term residents such as “permanent residents” and “spouse of Japanese nationals, etc.” have basically the same insurance obligations as Japanese nationals. Regarding the specific insurance requirements for different statuses of residence, foreigners should check the latest official information or consult relevant departments to ensure compliance.

The insurance enrollment process and required documents vary depending on the type of insurance and personal circumstances, but generally include the following steps: First, foreigners need to register as a resident at the relevant window in the municipality, town or village, and obtain a resident card. Then, depending on the employment situation, go through the insurance enrollment procedures through the employer or go to an annuity office, health insurance association and other institutions on your own. Required documents generally include residence card, passport, resident card, employment contract (if applicable), etc. For National Health Insurance, you usually need to apply for it at the municipal counter in your place of residence. It is worth noting that some regions have begun to implement online application systems, simplifying the insurance enrollment process. When applying for insurance, foreigners should keep copies of all relevant documents for subsequent use.

In order to help foreigners better understand and participate in the social insurance system, the Japanese government and local governments provide consulting services and resources in multiple languages. For example, the official website of the Ministry of Health, Labor and Welfare provides social insurance guides in multiple languages. Many municipalities also have interpreters or telephone interpreters at their foreign service counters. In addition, some non-governmental organizations and international exchange associations also provide related consulting services. Foreigners can use these resources to obtain accurate information and answer questions during the insurance enrollment process. Foreign residents are advised to proactively seek these services to ensure they properly understand their rights and obligations.

During the insurance process, foreigners often encounter some misunderstandings and matters that require special attention. A common misconception is that private insurance can completely replace social insurance in Japan, which is incorrect. Even if you have purchased private insurance, eligible foreigners are still required to participate in Japan’s social insurance. Another misunderstanding is that short-term work in Japan does not require insurance. In fact, even short-term work may require insurance as long as certain conditions are met. In addition, foreigners should pay attention to promptly updating personal information, such as address changes, residence status changes, etc., to ensure the accuracy of insurance status. At the same time, you should understand the payment conditions and application procedures of various insurances so that you can obtain corresponding protection in time when needed.

People who visit Japan temporarily and stay for a short period of time, such as tourists or business visitors, are generally not required to join Japan’s social insurance. However, these individuals should consider purchasing travel insurance or overseas medical insurance that covers their stay in Japan. Some countries have signed social security agreements with Japan, which may allow short-term dispatched personnel to continue to participate in the social insurance of the country of origin, while temporarily exempting them from the obligation to participate in insurance in Japan. Additionally, some universities offer special health insurance plans for short-term exchange students. Short-term residents should choose the most appropriate insurance plan based on their own circumstances to ensure medical protection during their stay in Japan.

When foreigners leave Japan, they need to properly handle their social insurance matters. For National Health Insurance and National Pension, you usually need to go through the withdrawal procedures at the municipal counter. For employee pension and health insurance, you need to apply through your employer. It is worth noting that if the period of paying annuity insurance in Japan is less than 10 years, foreigners may be eligible to apply for a “lump sum”, that is, a refund of part of the annuity insurance premium paid. However, after receiving the lump sum, the corresponding insurance period will no longer be included in the calculation of possible future annuity benefits. In addition, some countries have signed social security agreements with Japan, allowing payment records in Japan to be combined with records in the home country, which may affect future annuity eligibility. Therefore, before leaving Japan, foreigners are advised to carefully consider their own situation and seek professional advice if necessary to make the most advantageous choice.

Japan’s social insurance system provides comprehensive protection for foreigners in Japan, but it also requires foreigners to fulfill corresponding obligations. Understanding and correctly participating in this system is not only a legal requirement, but also an important way to ensure personal rights and interests. With the increase in international talent flow, the Japanese government is constantly improving relevant policies to adapt to the needs of different groups. Foreigners should take the initiative to understand the latest policy changes and actively participate in the social insurance system, so as to better integrate into Japanese society and enjoy the social security they deserve.

Frequently Asked Questions

Q1: What is the financial impact of social insurance fees on enterprises and individuals?

A1: Social insurance costs have a significant financial impact on both businesses and individuals. For enterprises, social insurance is an important human cost. Japan’s social insurance system requires employers to bear a considerable proportion of insurance premiums, which usually include health insurance, employees’ pension insurance, employment insurance and work-related injury insurance. Specifically, employers need to bear approximately 50% of the cost of employee health insurance and employee pension insurance, as well as the full cost of work-related injury insurance. These expenses directly impact a business’s operating costs and profit margins.

For small and medium-sized enterprises, this financial burden may be even more pronounced. However, in order to reduce the burden on small and medium-sized enterprises, the Japanese government has provided some preferential policies, such as reduction or exemption of social insurance materials or subsidies. In the long run, providing employees with comprehensive social security can increase employee loyalty and productivity, potentially offsetting these costs.

For individuals, social insurance costs are an important fixed expense. Employees usually bear about 50% of the cost of health insurance and employee pension insurance, which is deducted directly from their wages. While this reduces employees’ immediate disposable income, it also provides them with an important social safety net, including health care, pensions, and unemployment insurance.

Social insurance costs are usually calculated based on personal income, so higher income earners bear correspondingly higher costs. However, for some insurances, such as health insurance, the benefit level is not completely proportional to the payment amount, which reflects the principle of social mutual assistance.

Although social insurance fees constitute a certain financial burden for both enterprises and individuals, it is an important system for maintaining social stability and ensuring people’s livelihood. Through reasonable financial planning and making full use of various preferential policies provided by the government, companies and individuals can better balance social security expenditures and other financial needs.

Q2: How to deal with the social security issues of employees of multinational companies?

A2: The social security issues of multinational company employees involve the laws and regulations of multiple countries and need to be handled with caution. Japan has signed social security agreements with many countries to avoid double payment of social insurance premiums and ensure that the rights and interests of transnational workers are protected.

For foreign employees who are dispatched to Japan for a short period of time (usually no more than 5 years), they can continue to participate in the social security system of their original country and are temporarily exempted from paying corresponding social insurance premiums in Japan. This requires obtaining relevant supporting documents from the social security agency of the country of origin. For example, the agreement with the United States allows employees sent by American companies to Japan to continue to participate in the U.S. social security system for the first five years.

For employees who are stationed in Japan for a long period of time, they are usually required to participate in the Japanese social insurance system. However, due to the existence of social security agreements, the insurance premiums paid by these employees in Japan may be included in the social security records of their home countries, which will help them receive pensions and other benefits in their home countries in the future.

Multinational companies need to pay special attention to the fact that differences in social security systems in different countries may lead to unequal welfare benefits. To this end, many multinational companies will formulate globally consistent employee welfare policies and supplement social insurance through private insurance and other methods to ensure that employees in different countries can receive similar welfare protection.

In addition, multinational companies also need to consider tax issues. In some cases, social security contributions may affect the calculation of personal income tax. Therefore, companies often need to hire professional tax and human resources consultants to ensure compliance and optimize their employees’ overall compensation package.

Finally, multinational companies should establish a complete internal communication mechanism to ensure that employees fully understand their social security rights and obligations. Not only does this help employees make informed career decisions, it also builds employee trust and loyalty to the company.

Q3: How do self-employed persons (self-employed persons) participate in social security?

A3: In Japan, the social security participation method of self-employed persons (self-employed persons) is different from that of employed employees, but it is equally important. Self-employed people mainly receive basic social security through the National Pension and National Health Insurance.

For annuity insurance, self-employed persons need to join the No. 1 insured category of the National Pension (Basic Pension). Unlike employed employees, self-employed individuals are required to pay the full premium themselves. As of fiscal 2023, the monthly national pension insurance premium is 16,520 yen. Low-income people can apply for insurance premium exemption or deferment.

When it comes to health insurance, self-employed people are usually required to join the National Health Insurance. Insurance premiums are calculated based on factors such as income, assets, family size, and are managed by local governments. Compared with the health insurance that corporate employees participate in, the National Health Insurance premium may be higher, but it also provides corresponding medical protection.

Other types of insurance, such as employment insurance (unemployment insurance), are generally not available to self-employed people. However, in recent years, the Japanese government is exploring the possibility of expanding employment insurance coverage, taking into account the increase in flexible employment forms.

Self-employed people can also choose to participate in the National Pension Fund or Individual Determined Payout Annuity (iDeCo) to increase income security after retirement. These are voluntary supplementary annuity plans where the contribution amount can be selected based on one’s financial capabilities.

There may be specific social insurance systems for self-employed people in certain industries. For example, workers in agriculture, forestry, and fishery can join the Agriculture, Forestry, and Fishery Group Staff Mutual Aid Association.

A major challenge that self-employed people face when participating in Social Security is income instability. To this end, the Japanese government provides some flexible payment options, such as installment payment or temporary exemption from payment. However, long-term exemption from contributions may affect future insurance benefit levels and therefore requires careful consideration.

Although the way self-employed people participate in Social Security differs from that of employed employees, it is equally important. Self-employed people should fully understand various insurance options and make reasonable insurance plans based on their own circumstances to ensure appropriate social security.

Q4: What is the social security coverage for dependents?

A4: In Japan, social security coverage for dependents is mainly achieved through the main earner’s insurance, but there are also some specific regulations and restrictions. Understanding your dependents’ Social Security coverage is critical to family financial planning and risk management.

In terms of health insurance, dependents of employed employees can be enrolled in the employee’s health insurance as dependents. This usually applies to immediate family members such as spouses, children, parents, etc., provided that the annual income of these family members does not exceed a certain limit (annual income is less than 1.3 million yen in 2023). Dependents can enjoy the same medical coverage as the primary insured person, but do not need to pay additional insurance premiums.

For annuity insurance, the situation is slightly different. Although family members cannot directly join the Welfare Pension of the main earner, they can participate as the third insured person of the National Pension. This applies to spouses whose annual income falls below a certain threshold. As the third insured person, the spouse does not need to pay separate national pension insurance premiums, but can accumulate his or her own annuity rights.

Children usually do not need to participate in social insurance separately. They can receive medical coverage through their parents’ health insurance until they finish school or reach a certain age (usually 22). With an annuity, minors do not pay premiums but do not accrue annuity benefits.

For nursing care insurance, dependents over the age of 40 need to be insured separately. If the dependent is enrolled through the primary earner’s health insurance, the nursing care insurance premium will be deducted from the primary insured’s salary.

When it comes to unemployment insurance, dependents are generally not covered through the primary earner’s insurance. If dependents have independent jobs, they need to participate in employment insurance based on their employment status.

With the changes in social structure, the Japanese government is considering adjusting the social security coverage policy for dependents. For example, there is talk of increasing the income limit for dependent spouses to encourage more women to participate in the workforce.

For international families, there are also transnational considerations to consider. For example, if family members live in different countries, it may be necessary to consider the social security policies of multiple countries and use social security agreements to optimize security arrangements.

Japan’s social security system provides a considerable degree of protection for family members, but there are also some restrictions and special circumstances. Families should carefully assess the security needs of each member based on their own circumstances and seek professional advice when necessary to ensure that the whole family can obtain appropriate social security coverage.

Q5: What is the use and importance of Social Security Card (Main Card)?

A5: The social security card, known as “My Number Card” in Japan, is a multi-functional identity card launched by the Japanese government and plays an increasingly important role in social security and administrative services.

The MANPA contains each person’s unique 12-digit personal number (MPN), which is widely used in fields such as social security, taxation, and disaster countermeasures. Holding a MANUFACTURER can simplify many administrative procedures, such as applying for social insurance, filing taxes, applying for various government subsidies, etc.

In the field of social security, the use of MANILA is gradually expanding. For example, it can be used as a health insurance card, allowing medical institutions to quickly obtain patients’ insurance information and simplify the medical treatment process. In addition, the government is promoting the integration of MANILA with pension accounts, nursing care insurance cards, etc. to achieve the convenient service of “one card”.

Mahindra also has an electronic certificate function that can be used for online identity authentication. This allows cardholders to safely use various online government services, such as checking personal social security payment records, annuity information, etc. With the advancement of digital government services, this function of Mahindra will become increasingly important.

In terms of privacy protection, MANILA adopts high security measures. The card itself has an anti-counterfeiting function, and except for specific administrative procedures, private companies are not allowed to request or collect personal information at will.

It is worth noting that although the allocation of funds to all residents (including foreigners) is compulsory, applying for the funds itself is voluntary. However, considering its increasing importance and convenience, the government is actively promoting the popularity of MANUFACTURER.

For foreigners living in Japan, the MANUFACTURER is equally important. It not only serves as proof of identity, but also simplifies various administrative procedures, especially when dealing with social security-related matters.

However, the promotion of MAイナンバーカード also faces some challenges, such as some people’s concerns about information security and some older people who are not familiar with digital technology. To this end, the government is strengthening publicity and education and providing various forms of support services.

MANILA is becoming an important link connecting individuals, social security systems and government services. As its functions continue to expand and improve, it will play an increasingly important role in improving administrative efficiency and improving the quality of social security services.

Q6: What tax issues related to social security need to be paid attention to?

A6: Social security and taxation are closely related in Japan’s public finance system, and understanding the relationship between them is very important for both personal and corporate financial planning.

First, social insurance costs are generally deductible from taxable income in Japan. For employees, the health insurance premiums, welfare pension insurance premiums, etc. they pay can be fully deducted from their income, which helps to reduce the overall tax burden of individuals. For self-employed persons, the National Health Insurance premiums and National Pension Insurance premiums paid can also be deducted as social insurance materials.

However, it is important to note that some Social Security benefits may be taxable. For example, if the annuity payment exceeds a certain amount, income tax may be payable on the excess amount. Likewise, unemployment insurance benefits may be taxable, depending on the amount of the benefit and the individual’s overall income status.

For enterprises, social insurance fees paid for employees can usually be deducted as necessary expenses, thereby reducing the enterprise’s taxable profits. This alleviates the financial pressure on enterprises to bear social insurance costs to a certain extent.

In terms of consumption tax, most social security services, such as medical services and nursing care services, enjoy preferential policies that are exempt from consumption tax. This helps control the cost of these essential services and ensures their accessibility.

Japan has also implemented a policy called the “Social Security and Tax Number System” (i.e., the MANA System), which aims to improve the efficiency of social security and tax administration. Through this system, the government can more accurately grasp an individual’s income and social security payment status, thereby implementing tax and social security policies more fairly.

Regarding international tax issues, Japan has signed social security agreements with many countries to avoid double taxation and ensure the rights and interests of multinational workers. For example, under certain circumstances, foreigners who are assigned to work in Japan for a short period of time may be able to continue to pay social insurance in their home country and be exempted from the corresponding obligations in Japan.

Japan’s social security expenditures are facing tremendous pressure from an aging population. In order to maintain the sustainability of the system, the government may adjust relevant tax policies in the future. For example, the consumption tax rate may be raised to increase the financial sources of social security, or the pre-tax deduction policy for social security fees may be adjusted.

For individuals and businesses, understanding and rationally utilizing these tax policies can effectively reduce the overall tax burden. For example, by maximizing the pre-tax deduction of social insurance expenses, or rationally arranging the timing of pension collection to optimize after-tax returns, etc.

Tax issues related to social security cover a wide range of areas, and policies are constantly being adjusted. Both individuals and businesses should pay close attention to policy changes and seek professional tax advice when necessary to ensure compliance while maximizing tax benefits.

Q7: How to deal with social security disputes and complaints?

A7: In Japan’s complex social security system, disputes and complaints occur from time to time. Knowing how to properly respond to these issues is critical to protecting your rights.

First of all, when you encounter problems or questions related to social security, you should first contact the relevant management agency. For example, for questions about health insurance, you can contact the National Health Insurance Association (Kaikai) or the health insurance group to which you belong. For questions related to annuity, you can consult the local office of the Japan Pension Institution. In most cases, these agencies are able to provide the necessary information and explanations to resolve simple queries or misunderstandings.

If the issue cannot be resolved through initial communication, the next step may be to consider using the formal complaint or objection application process provided by each agency. For example, if you are dissatisfied with an annuity decision, you can file a request for review within 3 months of receiving notification of the decision. Regarding health insurance, if you are dissatisfied with the insurance benefit decision, you can submit a review request to the Social Insurance Review Committee of the Bureau of Health and Welfare.

For more complex disputes, consider seeking professional legal help. Lawyers’ associations across Japan often provide initial free legal consultation services. In addition, some non-profit organizations also provide social security-related consulting services, especially multilingual services for foreign residents.

In some cases, administrative review or administrative litigation may also be considered to resolve the dispute. For example, if you are still dissatisfied with the decision of the Social Security Review Board, you can file an administrative lawsuit with the local court. However, this is usually a last resort option as litigation can be lengthy and costly.

For foreign residents, language barriers can be a major challenge when dealing with disputes. In this case, you can seek help from the local international exchange association or foreigner support center. Many local governments also provide free translation services to assist foreign residents with administrative matters.

Timeliness is very important when dealing with social security disputes. Many appeals or review requests have strict deadlines, after which you may lose your right to appeal. Therefore, when a problem is discovered, action should be taken as soon as possible.

Prevention is better than cure, and in order to reduce the possibility of disputes, individuals should take the initiative to understand their rights and obligations. Regularly reviewing social security payment records and saving important documents and notices will help identify and resolve potential problems in a timely manner.

It is also important for companies to establish sound internal procedures to deal with employees’ social security-related issues. Not only does this increase employee satisfaction, it also reduces potential legal risks.

Overall, handling Social Security disputes requires patience, knowledge, and strategy. By understanding the correct procedures and seeking appropriate help, most problems can be resolved fairly and reasonably. At the same time, continuing to pay attention to changes in social security policies and proactively safeguarding one’s own rights and interests are also important ways to prevent disputes.