Benchmarking Call Summary: Japan - April 2019

Becoming knowledgeable about medical coverage; flexible working arrangements; work-life balance and stress; mental health; healthy eating perks; and workforce trends will deepen your understanding of this market.


April 24, 2019

Call Participants

13 attendees from 11 companies participated on the call. Companies came from various industries, including: food and beverage, retail, pharmaceuticals, banking/financial services, airline, technology and social media.

Purpose of Meeting

The Global Business Group on Health hosted a 60-minute member conversation about health and benefits in Japan. Call content was driven by attendees based on standard market practice in medical and health benefits offerings and other health promotion priorities in Japan.

Overview of Medical Coverage

Insurance plans in Japan are highly regulated and very structured. Companies with a small workforce are sometimes challenged with offering employees benefits that are unique and customizable. Instead, several companies offer employees “off the shelf” benefit plans. While the coverage in these plans is comprehensive, there are gaps in some areas. This includes mental health conditions, which are typically not covered.

Health Insurance Associations (HIA)

In our 2019 Japan survey, only 18% of members indicated having a self-managed HIA. Most medical benefits are covered through HIAs in Japan. One notable gap is related to hospitalization coverage. To fill this gap, one company is planning to introduce a voluntary scheme where employees can purchase out-of-pocket coverage, leveraging their pre-existing broker and group insurance plan for death and disability coverage. In addition, the company provides ancillary benefits on a cash basis which are usually non-taxable.

Flexible Spending Accounts (FSA)

One member company is planning to launch an FSA to help optimize benefits and control costs. Many companies don’t offer supplementary medical coverage on top of the HIA. One company has a “cafeteria plan,” which is a supplementary plan where employees have other allowances that are payable from the company on a requested basis. Its goal is to help control costs and provide administrative efficiency.

FSA Challenges

Some companies are undergoing challenges with flexible spending accounts. Specifically, they have a difficult time getting claims reimbursed. Challenges with claims administration have made it difficult for one company to promote FSAs for its employees globally. The FSA claims team sits with the company’s global vendor, but they are not familiar with Japan’s needs. In addition to an unfamiliarity with the local context, there are language challenges that have impacted claims. In order to make this process easier, employees have been asked to complete all forms in English and provide very detailed information when submitting claims.

Companies have also experienced challenges with reimbursement and tax withholding. One company spent 2-3 months clarifying tax withholding as well as social and labor insurance contributions related to their FSA account. They leverage payroll to help comply with local tax laws in Japan. Because of this, it took them six months to launch an FSA, not including the 6-9 months it took to build the platform.

Flexible Working Arrangements

Numerous companies provide flexible working environments for their employees in Japan. For example, one company requires employees to work a set number of hours during the week, with flexibility to work them however they choose. They also give eligible employees the option to tele-commute at their leisure. Although this is available to employees in Japan, cultural norms sometimes impede this benefit. Additionally, the company has a fully-flexible workspace, so employees can sit anywhere in the office.

Another company officially launched its work from home benefit last year and they’ve noticed a very high utilization rate. It has helped reduce employee’s commute time as well as the associated stress with commuting and has allowed employees to spend more time with their families.

Employee Stress and Work-life Balance

The Stress Check program, mandated by the Japanese government, screens workers for high psychosocial stress in the workplace. It’s required in all workplaces with 50 or more employees and is conducted yearly. One member company is taking a different approach to the annual stress check. Instead of administering the normal paper-based stress questionnaire, they will contract with a psychologist to come to the office and interview each employee over a span of three days. They hope by employees going to see a doctor 1:1, they will get honest answers and ensure that employees are not stressed. Depending on the outcome of this strategy, they may continue with this approach going forward or conduct the traditional paper-based stress check.

Employing or contracting occupational health physicians at worksites is a common trend among employers in Japan. One GBGH member company conducts the traditional stress check and provides 1:1 counseling sessions for employees. Similarly, another company analyzes the results of their employee’s stress check and determines which job functions have the highest stress within each organization and business. They found that employees working in the distribution center and factory have higher stress compared to other employee groups. In order to curb stress levels in these groups, they enhanced their occupational health doctor structure for each office and branch with more than 50 people. They are also providing EAP services and actively promoting the service.

Mental Health

Mental health is a top priority for the majority of members located around the world. Challenges such as access and stigma manifest in different across countries.


Most employers are a part of an industry-led health association (HIA). If an employee seeks mental health counseling on their own, it’s unlikely that it is covered. However, if an employee visits a doctor for a medical condition and needs counseling as a result of their visit, it is covered.

Companies with 50 or more employees must comply with Japan’s stress-check program. Because of this, most companies typically address high-stress by hiring an occupational health doctor. Through a robust process, the company works with its occupational health doctor to analyze employee’s annual health check results and observe any trends. They also compare the number of hours worked to standard hours. Depending on these results, a drug may be prescribed, which is typically covered through an employee’s medical insurance.

Employee Assistance Programs (EAP)

Those on the call indicated that it’s very uncommon for employees to use EAPs in Japan, so utilization can be low. One company noted that one of the issues with EAP is that the same counselor may not be available for follow-up calls, which leaves employees re-explaining their issues. There is no continuity and many employers find the structure to be very ineffective. Some companies approach the “softer” health services by being vigilant with annual health check-ups and monitoring overtime hours, etc.

One company hired an on-site psychologist for confidential counseling a few times a week. Sessions are held away from high-foot traffic areas and provide employees with the option of seeing someone on-site instead of calling a number for an EAP. They also employ an occupational health doctor, but their role is to advocate for the company and mitigate risks. The psychologist’s role is to advocate for the employee. They want employees to be able to speak to someone before they have issues. They also want to destigmatize seeking help and ensure that employees have someone to help maintain their resilience. It’s highly utilized and has been helping employees with strategies and other coping mechanisms.

Another company noted that the combination of EAP and local doctors works best for them. As most employees speak Japanese, it’s easier for employees to access services. This also helps manage local statutory requirements and identify general local market practices. They want to strike a balance by leveraging their global practice and resources, but also aligning with needs of employees locally.


One company conducted 1-hour mindfulness trainings over a period of 8 weeks. They used a large meeting room and hired a mindfulness expert to facilitate the training. Employees could come and go as they pleased and practice mindfulness for any length of time. It was very popular among employees.

Healthy Eating Perks

Some employers provide free snacks to employees. One company shared that they provide a free nutritious snack to employees three times a week. The snack is distributed on one floor of their office building, as providing it on every floor required too much logistical support. Distributing it on one floor also promotes healthy movement, as employees need to walk or go up and down stairs. Similarly, another company occasionally offers employees a healthy snack, like a banana, at their on-site fitness center. However, this is only available to fitness center members.

Workforce Trends

Japanese regulations require that if an employee between the ages of 60-65 wants to continue working, companies need to accommodate that employee. One member company is working to accommodate this age group and enhance the productivity of all employees in Japan—regardless of their age. Another company, in the IT and technology industry, noticed that most of its employees are over the age of 30. To attract younger talent, they began contacting universities to diversify the workforce.


One company, in a male-dominated industry, began efforts to attract and retain women in the workforce. They conduct public talks for working moms and those who’ve just given birth. They realize that this population has valuable knowledge and skills, so they’ve offered some of them contract work to help re-enter the workforce.

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