Japan’s Healthcare Sector Embraces Digital Transformation

Did you know that, in 2021, Japan’s electronic medical record (EMR) adoption rate in primary care was only 42%? This was revealed by a 2023 survey by L.E.K. Consulting, indicating Japan’s lag in digital transformation (DX) within the medical field—particularly in comparison with its fellow Organisation for Economic Co-operation and Development (OECD) countries that held an average of 93% at the time of the survey. This stark contrast highlights Japan’s documented gap in digital health adoption, which is surprising for a country renowned for technological innovation.

However, in recent years, a significant shift has been underway. Japanese medical institutions are increasingly recognizing the potential of digital solutions, ushering in a new era for Japan’s healthcare sector.

As reported by L.E.K. Consulting, Japanese hospitals are allocating more budget and staff to digital health initiatives, driven by the urgent need for pandemic preparedness, staff safety, and the pursuit of improved healthcare delivery. This surge in interest indicates progress, as Japan has historically been slow to adopt EMR primarily due to high costs and limited digital literacy among healthcare providers.

Interestingly, the pace towards digitalization has been observed to vary between public and private hospitals:

• Private hospitals are more proactive, implementing digital solutions for initial consultations, patient administration, and AI-driven diagnostics.
• Public hospitals, while slower to adopt, primarily use digital tools and technologies for patient information recording.
• In terms of the perceived value of digital health, private hospitals focus on value-based care and improved efficiency, while public institutions prioritize enhanced healthcare quality, such as reducing medical errors and boosting staff productivity.

In 2021, Prime Minister Suga Yoshihide launched the Digital Agency, aiming to streamline bureaucratic processes, enhance IT-related functions, and digitize public services. This wide-ranged initiative was employed across various industries, one of which was Japan’s high-potential healthcare sector.

A key focus of the agency is integrating My Number social security and tax identification cards into the healthcare system. These cards are designed to be used instead of health insurance certificates at medical facilities, allowing seamless access to personal health data, including exams, medications, and expenses. The government aimed to boost distribution by offering incentives and plans to integrate these cards with smartphones and other services. In September of 2021, the rate of My Number Cards issued was only 38% but has since increased to an impressive 78.8% as of April 2024.

While the push toward digital health is promising, concerns remain high, especially about patient privacy. A 2022 study published in the International Journal of Medical Informatics identified information leakage as the top concern, specifically when it comes to external data connections. Additionally, administrative burdens and a shortage of skilled digital health professionals could potentially hinder progress.

Robust cybersecurity measures and clear data privacy regulations are essential to build trust among patients and healthcare providers. To manage the existing limitations in digital literacy among healthcare professionals and patients, user-friendly interfaces and comprehensive training programs will be vital to ensure smooth adoption and maximize the benefits of digital tools.

To address these challenges, the Japanese government has initiated numerous programs to promote EMR adoption and standardization among institutions. Since 2020, the government has allocated funding for small and medium medical institutions to standardize their approach to EMR adoption. 

Digital health is crucial for overcoming challenges and improving healthcare delivery in Japan. Specific solutions such as EMR systems, telehealth platforms, and AI-powered diagnostics offer promising benefits. These technologies can enhance data security, provide user-friendly interfaces, and include training programs to improve digital literacy.

For instance, telehealth platforms enable remote consultations, reducing the need for in-person visits and thereby minimizing infection risks. AI-powered diagnostics can assist in early disease detection, improving patient outcomes. EMR systems streamline patient information management, reducing administrative burdens and errors.

By embracing these advanced solutions, Japan can further transform its healthcare industry to be more patient-centric while enhancing care quality and safety among both patients and medical professionals. As Japan further pursues its journey toward healthcare digitalization, the country can address head-on its persisting issues in workforce shortages and its aging population, and ultimately pave the way for a more efficient and effective healthcare system.