Friday, October 14, 2011

Health Insurance Guide #5: Do I Need Insurance At All?

Now for the final installment of our health insurance series, where we will address the monetary and moral dilemma of whether or not you really need insurance.

The Dilemma

First and foremost, not everyone has the luxury of choosing whether or not they enroll in a health insurance scheme. However, for students, self-employed, or those working for small English schools or dispatch firms, the choice to go down to the city office and enroll in NHI is all yours.

The main pain of NHI is that payments will be deceptively cheap only to jump drastically after your first year of paid salary. Depending on your income and number of dependents, this can be a significant expense, generally more so than those who are enrolled in EHI. Moreover, you have the added chagrin of knowing that a large portion of your premiums go to covering the cost of low-cost insurance for the elderly. Therefore, it is tempting to just keep that 15,000-30,000 or so yen a month that would go to health care and save it for a rainy day.

Lets look at the pros and cons health insurance

  • Living (relatively) worry free-- This is probably an obvious point but being insured can assure you a great deal of freedom by providing a social safety net. You don't have to fret about one dehabilitating and potentially costly injury ruining your life savings. Obviously, there are out of pocket costs associated with health care but when you have to get that super expensive operation it will seem like a bargain
  • Planning for the Future-- As a young, virile individual, its easy to dismiss health care as a service for old fogies. However, we are all doomed to become geezers sooner or later and, more importantly, you never know what the future holds. Many people come to Japan with the intention of only staying a year or two and then end up settling down and making a family. When you have neglected to pay insurance premiums for all those year, singing up will cost a bundle in back payments which cash strapped municipalities are unlikely to forgive.
  • Being a Good Citizen-- Public health insurance is, by its very nature, a cooperative effort where in neighbors pool together to help those who have fallen on hard times. More than just not sorting your garbage or refusing to pay neighborhood association fees, not having health insurance is not only a violation of the law (albeit an unenforced law with no punishments), but you are also failing to support your fellow citizens. That said, there are more than a few Japanese who don't pay into the system but nuts to them.
  • Cost-- While Japanese health insurance may seem like a steal for Americans who are accustomed to being ripped off for health care, Japan is unique amongst many other countries insofar as health insurance is not paid through general wage taxation. NHI in particular can be extraordinary expensive for those on a limited budget and who have multiple dependents. Although the cost of EHI is rising as well, NHI tends to be a bit more expensive for those who don't qualify for exemptions.
  • The Old Folks Factor-- The truth of the matter is that, as an NHI insurance, the lion's share of your tax and "elderly support fee" go to support Japan's massive geriatric community who are by far the biggest users of public health care. Those 75 and over entitled to extremely cheap insurance wherein they only pay 10 percent out of pocket and pay a very low monthly premium as well as low limits on high medical care. The fact that the septuagenarian crowd eats up so much of your insurance fees while paying so little is enough to make people opt to not join the system.
  • Administrative Hassle-- Since NHI fees are based on the previous years earnings, you have to make sure you properly file taxes resulting from non-full time and/or part time work. If you are student, you have to make sure to file for a student reduction every year at the town hall as well as submit all your withholding slips to town hall. If you are self employed or work multiple jobs then this can be an extra hassle.
While not everyone has the option to avoid the system, the choice to join public health insurance is ultimately your own. In this author's own opinion, joining the NHI is not only the socially responsible thing to do, it is a great boon in the odd event that your Iron Man body fails you. Having insurance is precisely for those times that you can never possibly predict. Yeah, the cost sucks but in the end you have peace of mind and you are one step closer to being a productive member or Japanese society.

Well, that about does it folks! Thanks for taking a look at our Japanese health insurance super feature.

Other posts in this series

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