Discussing the money in medicine (Episode 92)
Electronic Disclosure System for Financial Statements - Medical Corporations and Social Welfare Corporations
Tetsuya Tanimoto, M.D.
Physician, Medical Governance Research Institute
Here, I must confess, I've led a life with little attachment to money. I didn't come from a wealthy family. My father was a doctor at a university hospital, and as a child, I barely had enough books to read (partly due to living in a rural area without bookstores), and I didn't do much extracurricular activities or have any experience with entrance exams for pupils (naturally, there weren't any cram schools or training schools in my overly rural area either). As a high school student, I remember leading a relatively frugal life where the highlight was buying about one CD a month and a few paperback books.
After entering university, I didn't have to work part-time too earnestly thanks to a somewhat generous allowance from my father. After becoming a doctor, I wasn't able to live luxuriously, but my salary was reasonably decent for me, so I was mainly focused on practicing medicine and research without giving it much thought. However, after getting married, having children, and starting to take out a mortgage, I couldn't afford to be uninterested in money. Taxes are high, and I have to save for my children's education. The cost of living in Tokyo is also high, so I try to keep unnecessary expenses to a minimum and continue to live a modest life.
Once you get to this point, a slight interest in money begins to sprout. I went to bookstores and bought a few of the many money-related books, and even started studying a bit. What's surprising is not just the amount of material for adults, but also for children. Looking at the financial education environment for today's children, I feel like it's a different era from my time. Books about money are on sale in abundance, targeting not just elementary school students, but even preschool children.
Indeed, I often hear the claim that money is not the purpose of life. However, if you lack financial literacy, you end up being controlled by your financial circumstances. Having lived for half a century, I have seen numerous examples of this in my surroundings. Furthermore, due to some inexplicable turn of fate, I myself have joined the management team of medical corporations and social welfare corporations, getting caught up in financial difficulties, and only recently have I started studying financial analysis and financial statements.
Financial analysis can be a bit daunting due to the specialized terminology, but it becomes surprisingly interesting once you understand it. As long as you can do addition, subtraction, and division, there's no problem. By deciphering the numbers, you can solve the mystery behind the corporate management situation, future prospects, management issues, etc. While researching various aspects, I noticed the difference in the degree of information disclosure between medical corporations and social welfare corporations in Japan.
Due to the amendment of the Medical Service Law, it seems that financial statements included in business reports should be viewable by a third party. However, until recently, the scheme was almost the same as the previous pharmaceutical money disclosure method. To view the information, you had to apply to the administration during specific time slots and obtain prior permission, and you had to physically go to the office window for viewing. The system was essentially designed so that third parties couldn't freely conduct financial analysis, and it was merely a form of disclosure. Given the public benefit of medical corporations, I have seen records of discussions by the Ministry of Health, Labour and Welfare on the introduction of online viewing of business reports, but the discussions were almost the same as those on the disclosure of pharmaceutical money.
This situation changed from April of this year, 2023. Thanks to the efforts of the Ministry of Health, Labour and Welfare, who seemed to have pushed back against the opposition forces, a system began where business reports of medical corporations are digitized and can be viewed from many prefectural homepages and other sources. I have not yet been able to investigate this because I am busy with the management tasks of the facility I am involved in, but I expect that if I compare the financial analysis of various medical corporations, I will discover various interesting things.
Leading in transparency are social welfare corporations. The Independent Administrative Institution Welfare Medical Organization (WAM) has been operating an electronic disclosure system for financial statements for some time, and it compiles national totals in an easy-to-understand format on their website for the public. It's necessary to discuss the difference in the degree of information disclosure between medical corporations and social welfare corporations in Japan from the perspective of public interest.
Originally published in Japanese in Iyakukeizai (Pharmaceuticals and Economics), July 1, 2023