Only 10% of Municipalities Implement Caps on Disability Welfare Services, Japan’s Health Ministry Reports

From The Fukushi Shimbun

August 27 2025

TOKYO – A survey by the Ministry of Health, Labor and Welfare has found that only 10% of local governments (prefectures, ordinance-designated cities, core cities, and some municipalities) implement the so-called “service volume cap” system, which allows them to withhold approval of new service providers to prevent disability welfare services from exceeding actual needs. About 40% of local governments expressed a positive stance toward implementation, while 30% were negative, showing differences in approach and policy.

The results were presented on July 24 at a meeting of the Social Security Council’s Subcommittee on Persons with Disabilities, which is discussing the 8th Disability Welfare Plan for fiscal years 2027–2029. Currently, the cap applies to four services: residential facilities for persons with disabilities, day activity (life care) services, and two types of continuous employment support (Type A and Type B). One of the discussion points is whether to add group homes (GH), which have rapidly increased in recent years, to the list.

In estimating service needs, 80% of municipalities based their figures primarily on past service levels, while also considering surveys and national disability welfare policies. As of fiscal 2023, the supply of GH, Type A, and Type B employment support exceeded projected demand, with GH in particular exceeding estimates in 40 prefectures.

Reasons cited by governments in favor of the cap included: “Maintaining an appropriate number of providers will help ensure service quality.” The main reason against it was: “We need to be able to respond to demand even when it exceeds projections.” Group homes were the service most frequently mentioned as needing to be added to the cap system.

Meanwhile, only 50% of municipalities were aware of the new petition system (introduced in April 2024) that allows them to give input to prefectures when new providers are designated, and only 10% had actually submitted opinions.

Committee members also voiced concerns that caps do not directly guarantee service quality, stressed the need for more accurate demand forecasting, and noted that even if group homes have vacancies, they may refuse to accept people with severe disabilities—raising fears that discussions could focus merely on numbers rather than real needs.