Cover for all: Mandatory health insurance is due to be introduced soon

Among Dubai’s insurers, one of the most widely anticipated developments set for the year ahead is the likely introduction of mandatory, employer-funded health coverage for all Dubai residents. This is expected to give a major boost to both premiums and competition as local insurers do battle for health care accounts. The move is expected to ease growing pressure on the accident and emergency services currently provided by the Dubai Health Authority (DHA), while retaining more expatriate medical business within the emirate and paving the way for an expansion of medical tourism via boosted private health facilities.

FACTS & FIGURES: According to the DHA’s Dubai Health Sector Strategy 2011-13, the emirate is well serviced in terms of both public and private primary health care (PHC) facilities. As of year-end 2011, there were 23 public sector PHC centres or clinics, along with 398 private sector ones. The physician-to-population ratio was 1:2438, while the per capita ratio of annual visits to a PHC facility was 0.7. While the first of these numbers is not far off World Health Organisation (WHO) recommendations, the latter two numbers are lower than in Western nations, such as the UK, where the ratio is 1:1400 and the per capita visit figure is 4.0. The WHO recommended a per capita visit figure of 3.0 per year.

When these figures are broken down between UAE nationals and expatriates, the majority of the former group visit public PHC centres, and the latter go to private ones. The DHA figures show 530,280 nationals visiting public PHCs and 76,594 visiting private PHCs in 2011, a per capita visit ratio of 3.5 visits per year. For expatriates, the respective figures were 182,746 visiting public PHCs, 554,821 visiting private, and a ratio of 0.4 visits per year. These figures demonstrate that expatriates are not going to health facilities with the recommended regularity. Given that around 85-90% of the population are expatriates, the fact that the total number of national and non-national visitors was roughly similar means the raw numbers are below where they should be. Largely, this is for financial reasons – the majority of expatriates are unskilled or semi-skilled workers on low salaries, without health insurance.

COVER FOR UNINSURED: Introducing mandatory health cover is aimed largely at bringing this uninsured population into the system. Indeed, a DHA survey in 2010 showed that around 75% of all Indian, Arab and other Asian expatriates in the emirate had no health insurance. By contrast, nationals can already take advantage of the state system, although there are also private health care options, such as the Enaya scheme available to government employees, which provides coverage for around 100,000 people. Middle- to high-income expatriates, meanwhile, are also often provided with private health care coverage by their employers, or have their own private health care plans – indeed, those working in the free zones must be provided with these.

Compulsory health insurance for Dubai would follow developments in health care elsewhere in the UAE. Dubai announced plans for a similar scheme to the one used in Abu Dhabi some time ago, initially proposing a 2009 deadline. This was then extended, with the most recent date for this to begin now set by the DHA at 2013. The original Dubai plan saw employers obliged to pay the government Dh500-800 ($136-218) a year for each employee, with each of these then registering with an outpatient clinic for basic health care. The 2009 deadline was postponed as it was felt that at that time, the impact of the downturn on businesses made these extra payments too much of a burden. Indeed, getting this figure right is crucial – explaining the time being taken to come up with the final policy.

When the system takes off there is likely to be an expansion of private health care facilities to cope with increasing numbers of insured, while insurance firms will also benefit. Ahmad Al Kazim, managing director of ASCANA, told OBG, “Abu Dhabi’s mandatory health care has benefitted its residents and the insurance industry alike. Dubai has been looking to adopt such a mandate, and when it does, many insurance segments will prosper, especially the growing medical segment.”

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The Report: Dubai 2013

Insurance chapter from The Report: Dubai 2013

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