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PART ONE: INTRODUCTION

A LEADER OF GCC HEALTHCARE AN INTRODUCTION TO KSA HEALTHCARE KSA DEMOGRAPHIC OVERVIEW

KSA ECONOMIC OVERVIEW KSA MODEL OF ECONOMIC FLOW AND DEVELOPMENT HEALTHCARE SYSTEMS AND EXPENDITURE

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1.0 A Leader of GCC Healthcare

A look at the GCC Healthcare Market discloses the Kingdom of Saudi Arabia (KSA) in a leadership position with regards to financing and healthcare expenditure. KSA commits close to 3.6% of annual GDP to healthcare financing. GDP commitment to healthcare in comparison to

other developed countries is comparably low but expected to increase in oncoming years. Additionally, the healthcare market is experiencing an expansion at a rate of 12.3% (2010-1015). External resource contribution to healthcare financing remains zero and 70% of health financing emanates from the government sector; essentially, propelled into public health expenditure. Private health expenditure hovered between 1.1% and 1.4% of GDP for the past five years but this is expected to increase considering attempts by the government to privatize public hospitals and increase private sector participation in the healthcare market in addition to

other market changing reforms is the expansion of the healthcare insurance scheme.

Regionally, a cumulative average growth rate (CAGR) of about 11.4% is projected for the healthcare market for the period of 2010 to 2015. KSA (12.3%) is closely followed by the United Arab Emirates (UAE), which has begun to draw much attention in the Gulf at an impressive rate of 12.1%. Kuwait (9.5%), Oman (9.3%) and Qatar (8.4%) follow in that order with Bahrain in a last place with about 5.9% CAGR. The role played by oil reserves and other economic factors in

growth of the GCC market as a whole is recommendable. A close examination reveal predominant indicators like population, population growth rate, GDP and GDP growth rate, standard of living, increasing health issues primarily emanating from changing lifestyles, rate of immigration, events and mass gathering medicine in addition to other significant issues and concerns.

With the annual growth of 11.4% for the entire region, the market is projected to reach $43.9 billion by 2015 straight from $25.6 billion in 2010 to an amount of USD 60 billion by 2025. Demand for hospital beds and healthcare services are also projected to increase alongside expansion with an estimated 40,000 additional hospital beds by 2020. The private sector is gradually moving into a leading role and beginning to gain grounds in health financing in all the countries in the region as they are more efficiently and productively managed; moreover, they

Figure 1. GCC countries Healthcare Sector Growth Rate (2010-2015)

Source: Gulf Writers

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lift the weight off the shoulders of the government and create a more sustainable economic

environment. KSA Healthcare basically represents GCC healthcare with more than double the resources of all

the other countries in the region combined with regards to numbers of hospitals and beds. The country alone accounts for close to 10 times that of some indicators of UAE which is next on the table as illustrated in Figure 2 below.

Reports show a tremendous difference between KSA figures and that of the other countries in the GCC with regards to many other indicators as well. However, despite leading numbers, per 1000 population indicators are very low due to relatively high population and population growth rate. The strong desire of the governments of KSA and UAE to raise healthcare to international

standards, create a medical hub for medical tourism, in addition to other efforts to enhance the sector, strongly propels growth in the market.

2.0 KSA Healthcare: An Introduction The healthcare sector of KSA remains one of the areas highly prioritized by the government.

This is evident in the level of resource dedication in the eighth and ninth National Development Plans (NDP). A tenth NDP is expected before the end of 2014 for the period of 2015 to 2019. ORYZ Saudi Arabia predicts substantial resource allocation to the healthcare sector in the tenth NDP taking a close look at the health service targets for the KSA Vision 2025 and the healthcare targets it has set to reach in comparison with the current state of affairs, given that there are only two more National Plans to be issued before the achievement of the Vision 2025 targets. With the NDPs discussed later in this report, a clearer view of the sector reveals the firm arm of

the government behind the greatly increased and improved market. The government applies

due efforts to provide its people with state of the arts healthcare service and facilities. Fundamentally, the government has wholly nurtured the health sector into one of the largest and most prominent on the globe with no other country coming close to such an expansion rate over such a short period as experienced in KSA over the last decade.

Last produced in 2000, the World Health Organization (WHO) ranking of effectiveness of world healthcare systems placed that of KSA as 26th among 190 healthcare systems over the world. KSA came before other healthcare systems like Australia (32), Canada (30), New Zealand (41). It as well came before United Arab Emirates (27), Qatar (44) and Kuwait (45) who are close pals in the GCC Region. This system of ranking is no more produced by the WHO due to the complexity of systems and indicators with varied weights across various regions. Essentially, it remains difficult to compare two or more healthcare system on the same grounds due to

Figure 2. GCC Healthcare Indicators 2011

Source: Gulf Writers

Country

Govt Private Govt Private Govt Private

Saudi Arabia 282 125 44,099 11,833 2,037 2,308

UAE 32 58 6,627 2,549 243 2,057

Kuwait 30 15 5,149 653 97 98

Qatar 5 4 2,464 394 30 177

Oman 55 5 5,430 189 217 817

Bahrain 10 13 1,702 384 24 N/A

Hospital Beds Clinics