Analysis: Healthcare in the GCC, what is the fuss all about?

Gulf governments need not only to increase the number of beds and hospitals but also invest in talent, a challenge many experts have highlighted

Layan Odeh
Published: Updated:
Enable Read mode
100% Font Size

Not only is the healthcare sector one of the first ones to embrace the fourth industrial revolution, but it is also where investors bet their money on, globally as well as regionally.

Projections for the GCC healthcare sector

In the Gulf Cooperation Council (GCC) countries, the healthcare sector is one of the fastest growing. To put words into numbers, Alpen Capital said in a report published last year that the sector will grow by an annual rate of 12 percent from 40.3 billion dollars in 2015 to 71.3 billion dollars in 2020.
The demand for hospital beds are also projected to grow at 2.3 percent annual rate from 100,000 in 2015 to 114,000 in 2020.

Several factors will support the growth of the GCC healthcare sector, to name a few; population growth, mega projects under development, high health costs, as well as applying mandatory health insurance in some GCC countries.

“The mandatory health insurance policy does not include solutions for elderly expatriates,” Ayham Refaat, managing director of Accumed, a revenue cycle management company said, adding that this poses a problem for the elderly living in the Gulf.

Increasing private sector participation

Nearly 70 percent of the projects are funded by the government, which is higher than the global average that stands at 60 percent, but with low oil prices weighing heavily on the GCC budgets, countries are working on increasing the private sector participation.

Dubai Health Authority sees that 70 percent of healthcare delivery will be provided by the private sector, according to the CEO of the American Hospital. Peter Makowski elaborated further saying that if there are services the private sector is providing which the public sector is not, instead of the government spending money on providing this specific service, they can join forces in a very quick efficient manner.

In fact, Saudi Arabia clearly outlined in its National Transformation Plan the government’s intention to increase the participation of the private sector from 25 percent to 35 percent by 2020. When asked about how the private hospitals are increasing their contribution in Saudi, the chairman of Saudi German Hospitals told Al Arabiya News Channel that the group has already launched two projects in the Kingdom and is planning on announcing more projects.

Sobhi Battarjee also confirmed that the government provides noninterest bearing loans to the healthcare private sector.

Costs too high

However, in order to excel in healthcare, the GCC governments need not only to increase the number of beds and hospitals but also invest in talent, a challenge many experts have highlighted. General Electric’s healthcare segment is working on solving this issue by training nurses and doctors and linking hospitals locally and with other hospitals abroad.

High costs is another challenge facing the healthcare sector, and Mawkowski sees this rise in costs as unsustainable, neither for the public sector nor the private one, “we need to figure out ways in which we can be more cost efficient as well as continue to provide high quality outcome,” he said.

Top Content Trending