<p>Since April 2000, a long-term care insurance system has been operating in Japan. Even though in principle each municipality is considered a separate insurer, the national government also permits joint administration of the system by several municipalities, mainly out of consideration for small municipalities that often have fiscal and personnel problems. From a geographical viewpoint, joint system administration is important because there are inconsistent relationships among each of the constituent municipalities of joint insurers between insurance benefits and burdens, which are the premiums for Category 1 insured persons (those aged 65 and over). This paper examines the joint administrations of two insurers: the Okinawa Wide Area Union for Long-term Care Insurance (OWAU), and the Shiribeshi Wide Area Union (SWAU). These insurers have a system of stepped premiums that divides constituent municipalities into plural groups based on each insurer’s particular choice. This paper analyzes these two systems from the viewpoint of the gap between the imposed premium amounts for joint insurers (A) and what the premium amounts would be (B) for each municipality under an individually administered system. Index of Premiums of Joint-insurers or (PJ) is equal to (A) divided by (B).</p><p>The principal findings are as follows:</p><p>The Okinawa Wide Area Union or OWAU, which consists of 28 municipalities, assigned its constituent municipalities to one of three groups based on the premium amounts for each municipality that were derived from accurate calculations based on the operation plan of the joint insurer. OWAU’s imposition system makes the PJs of several municipalities large, especially for municipalities whose premium amounts under independent insurers would be either very high or very low. Municipalities that would have the lowest premium amounts under independent insurers are made to pay premiums that are approximately 1.9 times as high; others would have had to pay the highest premiums get a discount of up to about 35%.</p><p>The Shiribeshi Wide Area Union or SWAU consists of 16 municipalities and also has a system of stepped premiums. But its system differs from that of OWAU because it treats municipalities without grouping them. On each constituent municipality, SWAU imposes different premium amounts that are derived from direct and precise calculations based on the operation plan. This imposition system promotes responsibility in each municipality for its long-term care insurance operation and financial administration.</p><p>Compared with SWAU, the OWAU grouping system has two main problems: the blurring of fiscal control for each municipality’s profit or loss, and the way municipalities are grouped together. The first is mainly due to errors in estimating the cost of services in the operation plans of the joint-insurers. As for the second problem, there is a limit to how far the PJs can be reduced as long as the grouping system is embraced. Based on the above analysis, the author proposes a better method of joint administration by combining: 1) grouping municipalities with the highest premiums together to avoid excessively high impositions; 2) grouping the mid-level premium municipalities together to reduce PJs; and 3) independently insuring the municipalities on which the lowest premiums are imposed.</p>