Devolution and privatization proceed and centralized system maintained: A twisted reality faced by Japanese nonprofit organizations

This article examines the intragovernmental and government-private relationships in the area of long-term care for the elderly in Japan,focusing on the impact of the introduction of long-term-care insurance (LTCI) in 2000. The outcome indicated that devolution and privatization were promoted through LTCI although the central government maintained control. This article identified the underlying forces that made the Japanese experience of devolution and privatization unique: the history of the government-private relationship, the dilemma between decentralization and the issue of equity, and the centralized system as the driving force of organizational isomorphism. The challenges and opportunities faced by Japanese nonprofit organizations are discussed based on the findings, as well as the influence of for-profit organizations in the examined area.