The fly in the ointment is the cost, particularly as the population ages; as I said before, it's a gold-plated system.
I hadn't seen the stronger language that you had seen, but I did find a British Medical Journal article that even used the same phrase of "mass exodus."
I then went over the Japan Medical Association's website, and read a bit. Taking into account natural Japanese reticence, I thought this was interesting:
5. Assuring a Solid Financial Basis for Medical Practitioners
Under the Social Insurance System in Japan, the entire population is covered by some form of medical insurance, and people can choose any medical institution to receive medical care at officially-set prices. The government decides a single fee for all forms of treatment. The decision is reviewed by the Central Medical Council on Social Insurance, an advisory body to the Minister of Health, Labour and Welfare. JMA recommends its members for inclusion in this panel to assure that its views are reflected in the council's decisions.
Regarding remuneration, medical institutions must rely on income mainly derived from the very low officially-set prices and are thus facing an increasingly bleak financial situation. The JMA is engaged in various lobbying activities with the National Diet (legislature) and related government ministries in an effort to establish an adequate remuneration system for the medical community.
6. Countermeasures Against an Aging Society (Long-term Care Insurance System)
In tandem with the aging of Japanese society and the yearly increase in the number of bedridden and elderly patients in need of nursing care, the JMA has continuously advocated access to health care services that would enable the elderly to live their lives in security, free from anxieties about health care. A long-term care insurance system that integrates nursing care services aimed at meeting the special health and lifestyle related needs of the elderly and quality health care services that promote health, disease prevention, treatment, and functional training was established from April 2000.
To promote the participation of the elderly in society and to mobilize society in general, the JMA announced its "Grand Design for Health Care in 2015" which introduces its intermediate vision on social security reforms. The JMA advocates the establishment of a new health care system that includes health insurance for the elderly over the age of seventy-five to resolve the various problems that stem from the existing system for the elderly.
7. JMA Professional Medical Liability Insurance System
Unexpected physical disorders or even deaths may occur in the course of routine medical practice. Although still rare in Japan, patients do file claims against physicians.
To settle conflicts under the civil law between patients and physicians regarding medical errors, the JMA created its own system called the JMA Professional Medical Liability Insurance in July 1973. As an academic organization responsible for medical care that is provided to the public, JMA is engaged in a wide range of activities, (1) concluding contracts with insurance companies, (2) establishing an authoritative and neutral body to deliberate disputes among members, (3) offering insurance coverage that enables physicians to pay large liability claims if they are held liable, and (4) cooperating with prefectural medical associations and insurance companies in settling disputes and seeking legal advice when necessary.
We take pride in this system of addressing disputes involving medical accidents, which has no parallel in other countries.
While the system currently works for Japan (and funding it in the future is a legitimate question), I am not sure what we can take away from it. As mentioned in the last paragraph, Japanese don't generally sue; Japan doesn't even have many lawyers, and I don't know if they have any that specialize in liability cases. This is in marked contrast with the U.S., where we have packs of lawyers with big billboards and disgusting television commercials encouraging people to "sue, sue, sue!"