This article first reviews the history of Japanese social policy in the post-World War II period, and then focuses specifically on the policy and politics of national health insurance. It describes the roles and motivations of the primary participants in the formulation and development of the Japanese health insurance system. It thereby demonstrates that the policy of “health insurance for the whole nation” was adopted in response to immediate social and political pressures, many of them not specifically related to matters of health; that the form this policy took was a product of incremental “muddling-through” rather than an orderly and rational process; and that the history of social insurance in Japan reflects primarily the preferences of the dominant political-economic elites, and only secondarily the needs and demands of ordinary Japanese citizens. Finally, the article examines possible lessons for the United States, and suggests that Americans take advantage of their position as “health insurance laggards” to study and reflect critically on the experience of Japan.

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