Japan’s Welfare Ministry Begins Discussions on 2027 Disability Compensation Revision; Focus on Addressing Rising Costs

From The Fukushi Shimbun via Yahoo! Japan

May 6 2026

TOKYO – Japan’s Ministry of Health, Labour and Welfare’s “Review Team on Revisions to Remuneration for Disability Welfare Services” met on April 28, marking the start of discussions toward the fiscal 2027 revision. In opening remarks, Masayuki Kamiya, Parliamentary Vice-Minister of Health, Labour and Welfare and head of the team, stated: “While the budget for disability welfare services has increased more than fourfold since the enforcement of the Services and Supports for Persons with Disabilities Act (April 2018), there are cases of service providers calculating add-on payments that do not align with the intent of the system, raising concerns about a decline in service quality. We aim to advance disability welfare policies steadily through discussions that incorporate the expertise of the team’s advisors and opinions from the field.”

Total expenditures on disability welfare services have grown particularly sharply, rising 12.1% following the FY2024 revision. As an emergency measure, steps such as reducing reimbursement unit prices for new providers in four services, including Type B continuous employment support, will be implemented in FY2026. However, ensuring the system’s sustainability will remain a key issue in the FY2027 revision.

In addition, urgent challenges include securing human resources, raising wages, and responding to rising prices. Other focal points will include ensuring the provision of high-quality services, addressing disparities arising from the entry of diverse operators, and establishing a service delivery system that meets needs without excess or shortfall.

The creation of “specified regional services,” included in the amendment bill to the Social Welfare Act and related laws approved by the Cabinet on April 3—covering measures such as more flexible staffing standards and the introduction of bundled payments in mountainous and other areas—will also be discussed.

Starting in June, the review team will conduct hearings with a total of 53 related organizations, organize key issues in August, and begin discussions on remuneration for each disability welfare service from September. It will compile basic policy directions in December and finalize a revision proposal in February 2027, taking into account the government’s FY2027 budget formulation.

The review will also draw on surveys of the financial conditions of facilities and service providers, surveys on working conditions for staff, and the results of various research projects.