If a frail elderly person
wanted to receive welfare services, at first he or she
had to apply to the local government (municipal welfare
office). After a means test, the local government
determined the eligibility and the amount of user fee.
If the applied person was evaluated as eligible, he or
she could receive welfare services as a kind of placement.
Available services were home care services
(i.e. home help services, home bathing service, day
care health service, short stay service, catering service, lease of home care and rehabilitation equipment)
and institutional service in a nursing home. The
amount of user fee was depending on the economic
status of the applicant family. As the user fee was
more expensive than that of medical services for the
middle and upper class households, most of them
preferred institutionalisation in hospitals as a substitute
to a nursing home. This kind of hospitalisation with a
social reason is cheap for the user but expensive for
the insurer and the government. One of the reasons
for the establishment of LTCI was to solve this problem
that was criticised by the payer organisations as
a symbol of the inappropriateness and inefficiency of
the Japanese health and welfare system for the aged.