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Theamount of user fee was depending on the economicstatus of the applicant family. As the user fee wasmore expensive than that of medical services for themiddle and upper class households, most of thempreferred institutionalisation in hospitals as a substituteto a nursing home. This kind of hospitalisation with asocial reason is cheap for the user but expensive forthe insurer and the government. One of the reasonsfor the establishment of LTCI was to solve this problemthat was criticised by the payer organisations asa symbol of the inappropriateness and inefficiency ofthe Japanese health and welfare system for the aged.
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