IBM Japan Health Insurance Association

IBM Japan Health Insurance Association

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The Association's insurance premiums

You must pay insurance premiums when you join a health insurance program. While insurance premiums are based on your income (e.g., total remuneration including salary and bonuses), methods for calculating the premiums differ between monthly salary and bonuses.

Tips
  • Payment for insurance premiums is shared by the insured person and his or her employer. The amount paid by the insured person is deducted from salary and bonuses.
  • From age 40 through 64, premiums for long-term care insurance will also be collected.

Method of calculating insurance premiums

Since the amounts of remuneration received by insured persons are not perfectly uniform and fluctuate from month to month, calculating premiums based on each individual's actual remuneration amount is impractical. For this reason, insurance premiums are calculated based on a standard value (standard monthly remuneration) determined corresponding to a certain ranges of remuneration amounts.

Reference link
Reference Link

“The standard bonus” is the bonus amount (for these purposes capped at a cumulative annual maximum of 5.4 million yen) rounded down to the nearest 1,000 yen.

The Society's insurance premium rates

(After April, 2017)

  General insurance premium rate Long-term care insurance premium rate
Percentage paid by insured person 34.2/1000 5/1000
Percentage paid by employer 34.2/1000 5/1000
Total 68.4/1000
(Including regulation insurance premium rate)
10/1000
(Paid by insured persons aged 40-64)

Points at which standard remuneration is determined

Point of employment (point of acquisition of insurance status)

Workers join Health Insurance Societies upon employment. Health Insurance Societies use starting salaries, etc. as the basis for calculation of standard monthly remuneration amount.

July 1 of each year (fixed point)

Health Insurance Societies revise standard remuneration for all insured persons once a year. Remuneration calculations are revised every year on July 1, based on the salaries, etc. earned by workers in April, May, and June. The revised figures are applied for one year, from September 1 to August 31 of the following year.

Point of substantial salary change including pay raises (whenever revision becomes necessary)

Health Insurance Societies will provisionally revise standard remuneration in cases where monthly salaries grow substantially (at the rate of two levels or more) as a result of increases in basic monthly pay or periodic wage increases.

If the insured person's salary, etc. declines following his or her return to the workplace upon completion of child-care leave (revision on completion of child-care leave)

If an insured person caring for a child aged under 3 has seen his or her salary, etc. decline following a return to the workplace after completion of child-care leave (for example, due to implementation of a system of reduced working hours), the insured person may apply for revisions in his or her standard remuneration. This applies to such cases regardless of fluctuations in fixed wages, even when remuneration has changed by no more than one grade from the previous level.

End of maternity leave (revised upon end of leave)

If the salary/pay of an insured person returning to work after maternity leave changes due to reduced working hours or for other reasons, the insured person may apply to have his or her standard monthly remuneration revised.

Types of insurance premiums

Health insurance premiums consist of general insurance premiums, long-term care insurance premiums, and regulation insurance premiums. The amount of each premium is determined by multiplying the standard monthly remuneration and standard bonus by the insurance premium rate for each type of insurance.

General insurance premiums (base premiums + specific premiums)

General insurance premiums are generally used to help defray health insurance benefits. They also serve as financial resources for paying the cost of support for medical care for the elderly. To clarify the portion of the premiums that help defray support for the elderly, general insurance premiums are separated into base premiums and specific premiums.

Base premiums: premiums applied to services such as medical care benefits and health activities
Specific premiums: premiums applied to uses such as support payments to the medical care system for the advanced elderly and benefits for persons in the earlier stage of old age

The Society is free to determine its general insurance premium rate within the range of 3-12%, based on its specific needs and circumstances. Based on its specific needs and circumstances, it is also free to determine the shares paid by the employer and insured persons.

Long-term care insurance premiums

Long-term care insurance premiums are premiums for long-term care insurance. While the long-term care insurance system is run by each municipality across Japan, each medical care insurer is required to collect premiums from insured persons and dependents aged 40-64 who join the medical care scheme (both are regarded as category 2 insured persons under long-term care insurance). The Society collects premiums from insured persons aged 40-64.

Regulation insurance premiums

Health insurance societies in Japan jointly operate systems providing joint coverage of high-cost medical expenses and aid for societies facing dire financial circumstances (financial adjustments). Regulation insurance premiums fund these systems.

The insurance premium rate for these premiums is determined by multiplying the basic regulation insurance premium rate (0.13%) by the rate of slight variation (i.e., the rate of adjustment) based on the financial state of each society.

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