Nearly 90% of Municipal Hospitals Report Recurring Deficits Amidst Crisis; Demand for Significant Increase in Inpatient Basic Fees and Emergency Management Support – All Japan Hospital Association Chairman Mochizuki – GemMed

News Highlights

The Chairman of the All Japan Hospital Association (AJHA), Mr. Mochizuki, has requested a significant increase in inpatient basic fees and emergency management support in response to the current situation where approximately 90% of municipal hospitals are experiencing recurring deficits. This situation highlights the extreme fragility of the financial base of public hospitals supporting regional healthcare, and it may have a significant impact on the future healthcare delivery system.

Perspective from M&A Medical Editorial Department

The figure of “approximately 90% of municipal hospitals operating in the red” pointed out by AJHA Chairman Mochizuki is more than just a warning of deteriorating management. It confronts us with the reality that public hospitals, which can be considered the last bastion of regional healthcare, are facing a crisis of sustainability. It is presumed that the worsening financial conditions of local governments and the increasing costs of facility investments and personnel due to the advancement of medical technology are putting pressure on these hospitals. Under these circumstances, it is important that not only management support but also fundamental revenue improvement measures, such as an increase in inpatient basic fees during the medical fee revision, are being demanded. From an M&A perspective, this suggests the risk that management will gradually deteriorate without a clear path to improvement, ultimately leaving closure as the only option. By considering business succession while still in a sound state, the possibility of opening a path to protect patients, staff, and the continuity of regional healthcare increases.

Points Raised by This News

• The critical situation of approximately 90% of municipal hospitals operating in the red will have a serious impact on the maintenance of the regional healthcare delivery system.
• The demand for a significant increase in inpatient basic fees is a call for fundamental solutions to the revenue structure issues of public hospitals.
• The gap between the financial conditions of local governments and the necessity of regional healthcare may be pressuring the management of public hospitals.
• With the increasing risk of closure, early consideration of business succession is key to the continuation of regional healthcare.

Practical Questions Arising from This News

• What are the specific factors contributing to the recurring deficit rate reaching 90% in municipal hospitals?
• To what extent is an increase in inpatient basic fees expected to contribute to the improvement of municipal hospitals’ management?
• What specific types of support are being requested as management support measures?

If You Feel “Should I Consult Too?”

If your hospital’s management situation is falling into recurring deficits, or if there are signs of it, this news is not something to be taken lightly. In particular, the severe management environment faced by public hospitals that bear the responsibility for regional healthcare cannot be denied the possibility of further deterioration in the future. Business succession through M&A may not just be a “sale,” but a realistic option to keep the light of regional healthcare from going out. We recommend objectively evaluating your hospital’s financial status and future outlook, and promptly considering what options may be available with experts.

M&A Medical (CentralMedience Inc.) supports the business succession of medical corporations, hospitals, and clinics with a complete success fee system as an M&A support institution certified by the Small and Medium Enterprise Agency. We handle consultations with strict confidentiality. Free consultation here