Before his passing, Usui Sensei had asked Chujiro Hayashi Sensei to open his own Reiki clinic and to expand and develop Reiki Ryoho based on his previous experience as a medical doctor in the Navy. Motivated by this request, Hayashi Sensei started a school and clinic called Hayashi Reiki Kenkyukai (Institute). After Usui Sensei’s passing he left the Gakkai.(25)
At his clinic, which was located in Tokyo, he kept careful records of all the illnesses and conditions of his Reiki patients. He also kept records of which Reiki hand positions worked best to treat each illness and condition.
Based on these records he created the Reiki Ryoho Shinshin (Guidelines for Reiki Healing Method).(26) This healing guide was part of a class manual he gave to his students. The handbook was to be used only if the practitioner was not able to use Byosen scanning to find the best hand positions to use. Many of his students received their Reiki training in return for working in his clinic.(27)
Hayashi Sensei also changed the way Reiki sessions were given. Rather than have the client seated in a chair and treated by one practitioner as Usui Sensei had done, Hayashi Sensei had the client lie on a treatment table and receive treatment from several practitioners at a time. He also created a new, more effective system for giving Reiju (attunements).(28) In addition, to increase the value his students received while he was traveling, he developed a new method of teaching Reiki. In this method, he taught both Shoden and Okuden (Reiki I&II) together in one five-day seminar. Each day included two to three hours of instruction and one Reiju.(29) Following the Usui method, students were encouraged to receive Reiju on a regular basis from their local Shihan or teacher after completing Hayashi Sensei’s class so as to continue to refine and develop the quality of the Reiki energy that they channeled.
Because of his trip to Hawaii in 1937–38 prior to the Japanese attack on Pearl Harbor, he was asked by the Japanese military to provide information about the location of warehouses and other military targets in Honolulu. He refused to do so and was declared a traitor. This caused him to “lose face,” which meant he and his family would be disgraced and would be ostracized from Japanese society. The only solution was seppuku (ritual suicide), which he carried out. He died honorably on May 11, 1940.(30)
After this, Hayashi Sensei’s wife Chie Hayashi took over his clinic and ran it for some years, but eventually she retired; with no one to take over this position, the clinic came to an end. It is likely that some of Hayashi Sensei’s students continued to teach but most of these have also passed on. In 1999 it was discovered that Chiyoko Yamaguchi Sensei, a Shinpiden or Master student of Hayashi Sensei, was still alive and practicing. She was encouraged to teach and began doing so. Fortunately, I was able to take her Reiki I&II class in 2001 in Kyoto, Japan. Chiyoko Yamaguchi passed on in 2003.
Source: https://www.reiki.org/faqs/what-history-reiki