saudi arabia healthcare market report - introduction

G u l f W r i t e r s & D r e a m d r i v e D i g i t a l

GULF Writers & Dreamdrive Digital

KSA Healthcare Market: Complete Perspective 2014

February, 2014

PO Box 7289 Dubai, United Arab Emirates www.gulf-writers.com E-mail: [email protected]

Bi-annual GCC Healthcare Market Report

http://www.gulf-writers.com/

mailto:[email protected]

Gulf Writers & Dreamdrive Digital


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KSA HEALTHCARE MARKET: COMPLETE PERSPECTIVE 2014



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KSA HEALTHCARE MARKET: COMPLETE PERSPECTIVE 2014

© 2014 by Gulf Writers Management Consultancy

All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission of GULF WRITERS, except in the case of brief quotations embodied in reviews and other noncommercial uses permitted by copyright law. For permission requests, write to the company at the address below. The Permissions Coordinator GULF WRITERS PO Box 7289 Dubai, United Arab Emirates Tel/ Fax: +971 4 2802743 Email: [email protected]

mailto:[email protected]



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Contents

CONTENTS ........................................................................................................................................................ III TABLE OF FIGURES .............................................................................................................................................. IV EXECUTIVE SUMMARY .......................................................................................................................................... V

PART ONE: INTRODUCTION ........................................................................................................................... 1 1.0 A LEADER OF GCC HEALTHCARE ...................................................................................................................... 2 2.0 KSA HEALTHCARE: AN INTRODUCTION ............................................................................................................. 3 3.0 KSA DEMOGRAPHIC OVERVIEW ...................................................................................................................... 4 4.0 KSA ECONOMIC OVERVIEW ........................................................................................................................... 8

4.1 KSA Model of Economic Flow and Development .............................................................................. 12 5.0 HEALTHCARE EXPENDITURE .......................................................................................................................... 14

PART TWO: HEALTHCARE STRUCTURES AND SYSTEMS ............................................................................... 18 6.0 HEALTH SECTOR INDICATORS ........................................................................................................................ 19 7.0 STRUCTURE OF HEALTH SERVICES .................................................................................................................. 25 8.0 MASS GATHERING MEDICINE AND HEALTH INSURANCE ..................................................................................... 31

8.1 Health service in Hajj Season ............................................................................................................ 31 8.2 Healthcare Insurance ........................................................................................................................ 31

9.0 HEALTHCARE INFORMATION TECHNOLOGY ...................................................................................................... 34 9.1 Organizational Structure and Systems ............................................................................................. 34 9.2 Project Organization ......................................................................................................................... 36

10.0 HEALTHCARE AND DEVELOPMENT PLANS ...................................................................................................... 40 10.1 The National Development Planning Process ................................................................................. 40 10.2 Eight Development Plan (2005 – 2009) .......................................................................................... 42 10.3 The Ninth Development Plan (2010 – 2014) ................................................................................... 43 10.4 The Economic long term vision 2024 .............................................................................................. 44

PART THREE: CHALLENGES AND OTHER CONCERNS .................................................................................... 48 11.0 CHALLENGES IN KSA HEALTHCARE SYSTEM .................................................................................................... 49

11.1 Diseases and patterns ..................................................................................................................... 49 11.2 Health services distribution and accessibility ................................................................................. 49 11.3 Crisis prevention management ....................................................................................................... 50 11.4 Underutilization of information technology systems ...................................................................... 50 11.5 Privatization of Public Hospitals ..................................................................................................... 50 11.6 Health financing concerns .............................................................................................................. 51 11.7 Conflicting role of the MOH ............................................................................................................ 51 11.8 Workforce issues ............................................................................................................................. 51 11.9 Efficiency of KSA healthcare system ............................................................................................... 52

12.0 OTHER CONCERNS .................................................................................................................................... 53 12.1 Opportunities and key stakeholders ............................................................................................... 53 12.2 The Future of oil supply................................................................................................................... 54 12.3 Other Economic concerns ............................................................................................................... 55

REFERENCES AND BIBLIOGRAPHY ......................................................................................................................... 57 EXHIBITS ......................................................................................................................................................... 59

Exhibit 1 KSA Global Competitiveness Index in Detail............................................................................. 59 Exhibit 2 eHealth/ICT Project Reviewers ................................................................................................. 60

KEY CONTACTS ................................................................................................................................................. 61



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Table of Figures Figure 1. GCC countries Healthcare Sector Growth Rate (2010-2015) .............................................................. 2 Figure 2. GCC Healthcare Indicators 2011 ......................................................................................................... 3 Figure 3. Population of KSA (millions) ................................................................................................................ 5 Figure 4. Population of KSA: Vision 2025 and IMF estimates ............................................................................ 5 Figure 5. Structure of KSA Population 2013 (thousands) ................................................................................... 6 Figure 6. KSA Age-Gender Population 2013 ...................................................................................................... 7 Figure 7. KSA relative Gender Inequality Index (2012) ...................................................................................... 7 Figure 8. KSA HDI Trends based on consistent time series data 2012 ............................................................... 8 Figure 9. KSA GDP(PPP) and GDP (PPP) per capita 1990 - 2013 ......................................................................... 9 Figure 10. KSA GDP(PPP) and GDP (PPP) per capita 1990 – 2013 (US&KSA) ................................................... 10 Figure 11. GDP (PPP) comparison (Current US$ billions) ................................................................................. 10 Figure 12. non-oil private GDP as percentage of non-oil GDP ......................................................................... 11 Figure 13. Public and Private Sector Employment by Nationality (%) ............................................................. 11 Figure 14. KSA Model of Economic Flow .......................................................................................................... 12 Figure 15. Stage of KSA Economic Development – Global Competitiveness Index (2014) .............................. 13 Figure 16. Most Problematic areas for doing business in KSA (2014) .............................................................. 14 Figure 17. GCC Population and Healthcare Expenditure as percentage of GCC (2014) ................................... 15 Figure 18. Percentage of GDP spent on healthcare (2011) .............................................................................. 15 Figure 19. Expenditure Ratios (2011) ............................................................................................................... 16 Figure 20. Comparative per capita Expenditure on Healthcare (2011 – US$) ................................................. 16 Figure 21. KSA Healthcare Expenditure as a percentage of GDP ..................................................................... 17 Figure 22. International Comparative analysis per 1000 persons (2010/2011) ............................................... 19 Figure 23. Distribution of years of life lost by causes (2008) ........................................................................... 20 Figure 24. Distribution of causes of deaths in children under-5 (2010) ........................................................... 20 Figure 25. KSA Under-5 Mortality Rate ............................................................................................................ 21 Figure 26. Utilization of health services ........................................................................................................... 21 Figure 27. Adult Risk Factors (2008/2009) ....................................................................................................... 22 Figure 28. Hospitals and Hospital Beds in KSA (2013) ...................................................................................... 23 Figure 29. KSA Average Hospital bed capacity (2013) and MOH Hospital by Specialty (2009) ........................ 24 Figure 30. Inpatient/Outpatients Analysis (2010) ............................................................................................ 24 Figure 31. Four Tier Healthcare system ........................................................................................................... 26 Figure 32. Saudi Healthcare System ................................................................................................................. 27 Figure 33. Present (2010) and Future (2019) ................................................................................................... 28 Figure 34. MoH 10-year strategic plan objectives and rollout ......................................................................... 29 Figure 35. Medical Specialization according to the MoH 10 Year Plan (2019) ................................................ 29 Figure 36. Organizational Structure of the MOH ............................................................................................. 30 Figure 37. Health Insurance Scheme Implementation ..................................................................................... 32 Figure 38. Insurance Market Share and Insurance Premiums Growth in billions (USD) .................................. 33 Figure 39. Organizational Structure of the MOH ............................................................................................. 34 Figure 40. Solution Availability, Adoption & Usage Model (e-Health Project Approach) ................................ 35 Figure 41. eHealth Strategic Framework.......................................................................................................... 37 Figure 42. eHealth Strategic Framework.......................................................................................................... 38 Figure 43. eHealth Integrated Roadmap* ........................................................................................................ 39 Figure 44. NDP Focus Areas ............................................................................................................................. 41 Figure 45. Actual spending per developmental category ................................................................................ 41 Figure 46. Financial requirements of development sectors ............................................................................ 43 Figure 47. Financial requirements of Health Sectors ....................................................................................... 44 Figure 48. GDP and GDP per capita growth and projections ........................................................................... 46 Figure 49. Development of national workforce structure by level of education ............................................. 47 Figure 50. Distribution of Saudi Health Personnel in Healthcare service delivery (2009) ............................... 52



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Executive Summary

PART ONE: INTRODUCTION KSA is leading GCC Healthcare at an expansion rate of 12.3%; an 11.4% CAGR is estimated for the entire region to 2015. The sector is highly prioritized by the government with substantial

measures in place for national health development. KSA healthcare system falls among one of the most efficiently and effectively managed according to WHO and other recent rankings. Demographically, the country’s population is growing at 2.1%. At 28.3 million in 2012 the population is estimated to reach 30.9 million by 2015, exceeding the current 60% of the total GCC population. The portion of expatriates among the population is also expected to increase from 7.5 million (2010) to 8.1 in 2015 despite Saudization programs to reduce economic dependence on expatriates. A large belt of middle-aged population between 30 to 34 years

exists. KSA was ranked 145 with a GII value of 0.682 in 2012 and HDI has increased sturdily over the years to a value of 0.782 (57 out of 178 countries). Economic wise, the country highly

powered by its natural oil reserves and its contribution to a GDP (PPP); A sturdy 4.2% average growth is projected to 2018. Oil sector contribution to GDP is poised at 20% with the government making considerable attempt to reduce the impact on economic progress. KSA contributes over 63% of GCC healthcare expenditure with 3.6% contribution of GDP.

PART TWO: HEALTHCARE STRUCTURES AND SYSTEMS Comparative data from 2011 shows that KSA lays below world average in terms of Health Sector Indicators. Nurses and mid-wives and physicians per 1000 stood at 2.1 and 0.94 respectively; however hospital beds and other facilities are on the higher side. Contraceptive usage and tuberculosis treatments fell below regional average but births per 1000 and immunization levels are almost at 100%; far higher that regional average. Major adult risk factors include raised

blood glucose, raised blood pressure and obesity popular among men and women. The healthcare system basically consists of the MoH and quasi-government institutions that are together managed by the government, and private institutions managed by private investors. Quasi government institutions have highest bed capacity per medical facility and the MoH holds

60% of total hospitals numbering 250 as at the close of 2013. Health systems include the Health Services, MoH and the General Commission for Food and Medicines. The 4-tier healthcare system in the making principally classifies facilities into healthcare centres, local hospitals,

general hospitals and central hospitals, interconnecting them to a central medical city in the form of a pyramid and well organize format. Controlled from the MoH Central through the regional Director of Health Affairs to Deputy Hospital and Deputy Primary Health Affairs, measures are instituted to enhance the effectiveness of mass gathering medicine in periods of Hajj performance and the enrolment of a national health insurance scheme. Healthcare IT systems have been in focus since the eighth development plan and are firmly established for take-off; establishing immense growth prospects in the area of healthcare IT. The ninth

development plan, MoH ten year strategic plan, KSA Vision 2024 and other strategic plans firmly outline projected expansion in various aspects of healthcare development. PART THREE: CHALLENGES AND OTHER CONCERNS Major Challenges encountered by the government and the health system include changing

diseases patterns, unequal health service distribution and accessibility, inadequate crisis

prevention management and underutilization of eHealth systems. Other critical issues include the uncertainty of processes of privatization of public hospitals, health financing concerns, overpowering role of the MoH, in addition to other workforce issues. Key areas of prospective development include areas of Healthcare IT, medical cities projects, increased demand for healthcare practitioners and human resources, private sector medical equipment and infrastructure prospecting, and finally a highly attractive pharmaceutical industry. The future is associated with high levels of uncertainty as KSA major oil consumers like USA and China aspire

to cut oil imports and export themselves. The government of KSA plans stabilize projections by budgeting below the actual market price of its major export, creating room for large amounts of surplus. Other economic step-ups are critical if a more sustainable economy is to be created for the future generations of the country.