New Japanese Basic Resident Registration (“Zairyu Card”) to require health and pension information

OK, People, I honestly want to go back to discussing how the IRS is screwing Americans who work overseas, or how American multinational executives feel they are above the laws of Congress, or even the hit movie “Avatar”. But I am stuck on this f-ing [bleeping] expat health care thing.

As was widely reported last year, Japan will be introducing a new “Zairyu Card” and Basic Resident Registration to replace the current Alien Registration System. I am not sure the exact date when this happens, but it does happen shortly.

That means your “gaijin card” will go bye bye. And a new card will take its place.

The folks who actually read the rules as they come out—both Japanese and non-Japanese—have been looking at this. And one feature of the new system that is highly relevant to the current FreeChoice quasi-tax protest is the fact that under the new Basic Resident Registration system, a visa holder here will have his/her insurance and pension status recorded as part of the overall record.

This had never (officially) happened for the foreigners. But now it will.

I like what the Japanese Ministry of Internal Affairs (Soumu) put out at its offcial site, in English. If you read me, you are used to English, and so it should be no problem for you. It was no problem for the Japanese government people who put out the information.

The Japanese are making it clear that pension and health insurance are issues, and will be issues. So you skirt or shirk these at your own risk!

(Over on Debito’s, I had initially confused Soumu with Suumo, the Recruit brand. Ha ha! This is why I can never get the language down as well as I think I should!)

The Ministry has also produced this neat little chart. In my old company, I used to see a few workers piss countless hours away on useless process charts. But this one is no way in that category. I think it’s very valuable for making clear what the new deal is:

(Click to enlarge!)

Do you see the buckets for pension and health insurance? The gist is: you are going to get the same treatment as the ordinary Japanese resident with regard to these. This means, at minimum, you are going to be asked about your situation with pension and insurance (whether or not you are paid up).

If you take Japan seriously, where do you want to be in that regard?

9 thoughts on “New Japanese Basic Resident Registration (“Zairyu Card”) to require health and pension information

  1. [Hoofin’s note: this is a dialogue carried over from the Debito.org site, link here. My responses are in a separate WordPress box:]

    [I said:]
    —The rumor mill will have a good sense in just 24 days what the level of asking about insurance will be.—

    We will soon see.

    —Since new card is latest to be introduced in the next two years, and since back enrollment has generally been sought for no more than two previous years, there’s a possibility that 2010 payments may be sought in 2012..—

    Speculation.

    — The Social Insurance Agency is gone. Replaced by the Japan Pension Agency. Many Japanese have been hired for the single purpose of getting pension records in order. Naturally, health insurance is a close cousin, so I don’t think it would be surprising that the same initiative is taken in the near future—-.

    An estimated 25% of Japanese are not enrolled in any heath plan. If the J-government starts going after those Japanese not registered I would agree gaijins should be worried.

    —- The government needs money in its programs, not on the bottom line of insurers. Therefore, it’s not likely that they let this small segment continue to get away with making a private profit off the Japanese health care system, where it’s illegal to do so for the everyday Japanese.—

    I agree but until they go after the natives (which is where the money is at…) I don’t think gaijins not enrolled have much to worry about.

    —- Unlike even eight years ago, Japan has committed with other countries to open up its social insurance systems on an equal basis. Contrary to what the Choicers have started saying, Americans here–even on “short term”–are required to be in the Japanese program or else expressly certify via the U.S. Social Security administration that they are not (“Form USA/J-6″). Plus pay U.S. taxes. None of these formalities were present before, now are, and the U.S. does take taxes more seriously.—

    This is not true. I’m a US citizen who files both Federal and State tax and I certainly am not required to be enrolled in the Japanese health or pension program. In fact I am not required to pay into US social security at all.

    —Like so much of what has occurred in the Minshuto regime, one can expect that there will be multiple signals about what the government will do. But by the same token, different than in the past are these very multiple signals. There used to be none.—

    Again speculation and nothing I would worry about unless you’re already enrolled.

    Here’s a question: While the ward office no doubts would like you to be registered can they in fact force you to join the NHI if you currently are not insured?

    It seems to me that some gaijins are upset that other gaijins are getting away without paying while they must or else are upset because they feel skirting the law is wrong.

    Personally I’m not interested in either argument. All I really want to know is can you in fact be forced to enroll in the NHI?

    If so, can you provide a link backing this up?

    1. We will soon see. I agree.

      —Since new card is latest to be introduced in the next two years, and since back enrollment has generally been sought for no more than two previous years, there’s a possibility that 2010 payments may be sought in 2012..—

      Speculation. It depends what your definition of speculation is.

      — The Social Insurance Agency is gone. Replaced by the Japan Pension Agency Service. Many Japanese have been hired for the single purpose of getting pension records in order. Naturally, health insurance is a close cousin, so I don’t think it would be surprising that the same initiative is taken in the near future—-.

      An estimated 25% of Japanese are not enrolled in any heath plan. If the J-government starts going after those Japanese not registered I would agree gaijins should be worried.

      The Minshuto manifesto/platform has a clause about eliminating the separate employer plans and merging them and the NHI into regional cooperatives that would cover everybody. In part, because the employer plans run at a surplus, and NHI at a deficit.

      —- The government needs money in its programs, not on the bottom line of insurers. Therefore, it’s not likely that they let this small segment continue to get away with making a private profit off the Japanese health care system, where it’s illegal to do so for the everyday Japanese.—

      I agree but until they go after the natives (which is where the money is at…) I don’t think gaijins not enrolled have much to worry about.

      See the comment for the one immediately above.

      —- Unlike even eight years ago, Japan has committed with other countries to open up its social insurance systems on an equal basis. Contrary to what the Choicers have started saying, Americans here–even on “short term”–are required to be in the Japanese program or else expressly certify via the U.S. Social Security administration that they are not (“Form USA/J-6″). Plus pay U.S. taxes. None of these formalities were present before, now are, and the U.S. does take taxes more seriously.—

      This is not true. I’m a US citizen who files both Federal and State tax and I certainly am not required to be enrolled in the Japanese health or pension program. In fact I am not required to pay into US social security at all.

      You may have slightly misread what had said, in the context of the Choicers latest argument.

      If you make even $400 in self-employment income, you are required to file and pay self-employment (“SE”) taxes on it. The foreign earned income exclusion does not cover self-employment tax. The only way a self-employed American gets around that here is with a certification via from “J/USA-6”. But they need to be in the Japanese systems to obtain that.

      You are correct that if you only have employment wages or salary here (compensation from an employer), then there is no FICA liability and no SE liability. However, note that it is not rare for a Japanese employer to mischaracterize a foreign employee as an “independent contractor” for purposes of their (i.e. the employer’s) getting around the Japanese pension and health insurance. The term “independent contractor” has special significance with the IRS — it means the person is obligated to pay SE tax.

      So, my feeling is the way things have been done in the past here leaves the typical American open to a lot of potential liability.

      —Like so much of what has occurred in the Minshuto regime, one can expect that there will be multiple signals about what the government will do. But by the same token, different than in the past are these very multiple signals. There used to be none.—

      Again speculation and nothing I would worry about unless you’re already enrolled.

      You seem to have a very broad definition of the word, “speculation”.

      Here’s a question: While the ward office no doubts would like you to be registered can they in fact force you to join the NHI if you currently are not insured?

      It seems to me that some gaijins are upset that other gaijins are getting away without paying while they must or else are upset because they feel skirting the law is wrong.

      Personally I’m not interested in either argument. All I really want to know is can you in fact be forced to enroll in the NHI?

      If so, can you provide a link backing this up?

      I do not have a specific link, in Japanese or English, telling the local ward offices to do a “crackdown” as you put it, on Debito’s site. I can only offer up evidence.

      I know in Chuo, that if you leave NHI and go to an employer plan, the ward office will first check as to whether you were in NHI (I was from Day One), and backbill anyone who wasn’t.

      In Shibuya, probably one of the most on-the-ball ward offices, the ward knows who is enrolled and who isn’t. They will actively seek payment from those who are. Probably only coincidentally that this area is represented by Minister Nagatsuma, the Health and Labor Minister, in the Diet.

      I don’t think the pro-regulation people are concerned about the direct money cheating going on with the people who don’t join NHI. I think they are concerned about the effect of the scheme on the reputation of the expat community. And the secondary effect of the money-cheating, that it changes the relative prices for labor in the local market in favor of those who cheat. Taxes affect relative prices, as was emphasized by Professor Carl Shoup.

      People cheat all the time, on contracts, husbands/wives, friends as well as with money. There is no perfect justice. So I don’t think any of the pro-regulation people are worked up over this. There’s a certain expectation that cheaters are dealt with. That there is, at least, a rough justice.

  2. (Forgot to add)

    In any event it makes little sense to join (assuming you don’t want to…) the NHI unless you know for sure the Ward office will be coming after you because one thing is for certain: While there are still ways to get back into the system without paying the two years back premiums, once you do join they’ve got you (or at least until you move to new Ward…)

    1. I joined the very day I got my ARC.

      You are assuming that the earlier games, which people had used to get around being in will still work in the future (or even do today).

      What is that word you were using in the previous post for assertions based on other evidence?

  3. —I do not have a specific link, in Japanese or English, telling the local ward offices to do a “crackdown” as you put it—

    No. What I want to know is if the ward office can in fact force you to join the NHI?

    —I know in Chuo, that if you leave NHI and go to an employer plan, the ward office will first check as to whether you were in NHI (I was from Day One), and backbill anyone who wasn’t.

    Yes, if you join an employers plan and have been out of the system this usually happens.

    —In Shibuya, probably one of the most on-the-ball ward offices, the ward knows who is enrolled and who isn’t. They will actively seek payment from those who are—

    This is nothing new and has been my experience and the experience of others I know in Tokyo who at one time were enrolled. If you join you will be billed and if you don’t pay they will try to collect even if you move into another ward.

    —You are assuming that the earlier games, which people had used to get around being in will still work in the future (or even do today). What is that word you were using in the previous post for assertions based on other evidence?—

    Speculation but if you’ve been out for years like I have it makes no difference when you return if you can’t do so under the radar since the penalty is still (2) years back payment regardless of time gone. For those just arriving and don’t want to enroll it would be wise to wait until the issue becomes more clear in coming months.

    –So, my feeling is the way things have been done in the past here leaves the typical American open to a lot of potential liability.—

    I can’t speak for other professions but I’m a teacher who works p/t at various schools and who owns investment properties in the US. Thus my returns both Fed and State are often more complicated that many other US citizens I know here. However my CPA is first-rate and he has never mentioned new regualtions which might concern. J- heath insuarnce/pension plans.

    As far as the US social security office goes I usually receive a yearly statement despite not having paid into the program for 20 plus years . (I do have 40 quarters and qualify for benefits.)

    1. Ken44 responded to my post:

      —I do not have a specific link, in Japanese or English, telling the local ward offices to do a “crackdown” as you put it—

      No. What I want to know is if the ward office can in fact force you to join the NHI?

      The only link I have is to the National Health Insurance Law (1958, as amended), and it’s in Japanese, here. I cannot easily read Japanese (that is to say, I can only read it with a lot of effort.) And I can’t authoritatively tell you what it says. But my conclusion is that Article 5 or Paragraph 5 creates a “kokumin kenko hoken” to which everyone residing in a municipality is by law a part of, unless they meet an exception in Article 6 (having coverage under one of those other laws). Somewhere down around Article 9 does the law get into the Basic Resident Registration (“BRR” for short). It looks to me like, by simply being registered in the BRR, a Japanese citizen is automatically “in”, paying or not. (This is why there is no sanction in the law for “not enrolling”.) Just a guess. The “force” or “requirement” is that the law plainly states that the people domiciled in the location must be under the scheme.

      If you are a non-Japanese citizen, there is no exemption in that text. Which is probably why the U.S.-Japan totalization treaty commentary says that an American certifying to “private coverage” agrees that he/she is totally out of the Japanese system.

      —I know in Chuo, that if you leave NHI and go to an employer plan, the ward office will first check as to whether you were in NHI (I was from Day One), and backbill anyone who wasn’t.

      Yes, if you join an employers plan and have been out of the system this usually happens.

      So seeking out a private policy in the very beginning is actually bad advice, because it will complicate matters greatly if you ever accept a job in a company with Shakai Hoken.

      —In Shibuya, probably one of the most on-the-ball ward offices, the ward knows who is enrolled and who isn’t. They will actively seek payment from those who are—

      This is nothing new and has been my experience and the experience of others I know in Tokyo who at one time were enrolled. If you join you will be billed and if you don’t pay they will try to collect even if you move into another ward.

      Because this is the National Health Insurance Law of 1958, as amended.

      —You are assuming that the earlier games, which people had used to get around being in will still work in the future (or even do today). What is that word you were using in the previous post for assertions based on other evidence?—

      Speculation but if you’ve been out for years like I have it makes no difference when you return if you can’t do so under the radar since the penalty is still (2) years back payment regardless of time gone. For those just arriving and don’t want to enroll it would be wise to wait until the issue becomes more clear in coming months.

      What I’m hearing, and yes of course it’s hearsay, is that the government can go back beyond 2 years, even. The two years is some sort of guideline. I do agree, though, that the enforcement should be uniform across Japanese and non-Japanese.

      I think your other advice made sense in an earlier time for people who didn’t want to adhere to the country’s law about health insurance. But now I think that avenue is particularly risky. That’s where we differ of course.

      –So, my feeling is the way things have been done in the past here leaves the typical American open to a lot of potential liability.—

      I can’t speak for other professions but I’m a teacher who works p/t at various schools and who owns investment properties in the US. Thus my returns both Fed and State are often more complicated that many other US citizens I know here. However my CPA is first-rate and he has never mentioned new regulations which might concern. J- health insurance/pension plans.

      Good for you that you even file. I get the strong sense that many Americans here don’t, even when their tax liability would be zero. A non-filed year is, like the Denny’s Restaurant sign used to say, “Always Open”. After a time, the IRS can’t ask about a filed year–unless there’s been some serious lying on the 1040.

      If you looked at the totalization treaty, it’s clear that any American not certifying via “Form J/USA-6” potentially opens themselves up to questions about self-employment income in Japan. Is the IRS going to track down the kid making $5,000 as an eikaiwa grunt on the side? Probably not, but there is $765 of U.S. tax liability. And all the person had to do was sign up for pension and health insurance.

      It gets worse with these folks who set up themselves in a “K.K.” with the non-American wife owning it (Section 318 stock attribution rules). They want to pretend they are an employee of the Japanese stock corporation, but for American self-employment tax rules, they are self-employed. Rather than give the Shakai Hoken money over (since they are a K.K. and after all, an employee of one must enroll in SH), some conveniently ignore that and ignore the IRS.

      Does the IRS go after them? Who knows. The Service rarely announces these things. What went on with UBS and Switzerland was purposely widely publicized to send a message to the wider offshore tax cheater community. The Service is now taking in billions as a result.

      As far as the US social security office goes I usually receive a yearly statement despite not having paid into the program for 20 plus years . (I do have 40 quarters and qualify for benefits.)

      Yes, I get the same. I would also receive a Japanese pension via the totalization treaty, because they would count my years of U.S. contributions toward the necessary 25.

      I think PR Americans here that don’t have enough back home to qualify in Japan are eligible to apply for the “kara kikan” on their overseas time. The danger in that, though, is it might trigger the Windfall Elimination Provision (WEP) and cut their social security check. So my feeling is that it’s simply better to rely on the treaty. Those who need the treaty to qualify for a benefit are not hit with the WEP.

  4. —I don’t think the pro-regulation people are concerned about the direct money cheating going on with the people who don’t join NHI. I think they are concerned about the effect of the scheme on the reputation of the expat community.—-

    While I think you’re right that many gaijins (esp. long-term) may be concerned about the reputation of the expat community. It was my experience last year that conversations mainly centered on who would have to pay and who wouldn’t. Forget the moral/gaijin reputation argument. It was all about being forced to fork over an extra 25-35,000 yen a month while the gaijin sitting on the sofa across from you didn’t. Personally I find it wise to stay out of such arguments and just to say I’ve already enrolled. (Over the years I found it best to be careful around other gaijin teachers as they can be a jealous lot.)

    1. You’re also right that a lot of times, the less people know about your personal business here the better. The quality of backstabbing that goes on rivals any “polite environment” but aggressive situation back home–like in a corporation or maybe some community or club. If actual knives were being used, then rival statistics for the bad parts of Newark, Philly, etc.

      My beef with the Choicers is that this is just more bullshit. Everything in Japan has to come with this hokey, Third-World-style “local practice” when it involves non-Japanese. About the only thing clean, sometimes it seems, are the convenience stores. And the trains and subways. Everything else (the dealings I’m talking about) have to smell a little.

      Why can’t people just do things the right way?

      Re the Choicers, some of these folks have their legitimate special needs. OK fine, can’t these insurance companies write riders or other special policies to cover people who go back home a lot? They can sign up for what they’re supposed to, and then have the policy with the rider for the things they can’t get under normal insurance.

      The ones that didn’t pay the money because they didn’t know, or the boss twisted them, etc., can’t the government just provide a general amnesty on amounts that were given over to a private insurer?

      It seems like a lot of these problems could be solved in an afternoon.

  5. —–It looks to me like, by simply being registered in the BRR, a Japanese citizen is automatically “in”, paying or not. (This is why there is no sanction in the law for “not enrolling”.) Just a guess. The “force” or “requirement” is that the law plainly states that the people domiciled in the location must be under the scheme.—–

    Well, something is missing because from what I’ve read there is sizeable number of Japanese who are not enrolled in a health plan.

    Hopefully someone else can help but I don’t believe your local ward office can actually force you to join the NHI.

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