While falling oil revenues have prompted plans to scale back or reschedule some of Saudi Arabia’s programmes, the government has signalled that health projects will remain largely protected.
Speaking in early September, Ibrahim Alassaf, minister of finance, confirmed that spending on key social projects would be preserved, given their central role in broader economic development.
“Projects in sectors such as education, health and infrastructure are not only important for the private sector, but also for the long-term growth of the Saudi economy,” he told media.
His comments will provide reassurance for stakeholders in the health care industry, while also sending out a message to service suppliers and private sector operators that investment is set to continue.
Technology to the fore
In addition to maintaining public spending, Saudi Arabia has been stepping up efforts to promote investment opportunities in the health industry.
The sector featured on the agenda of trade and business meetings during King Salman bin Abdulaziz Al Saud’s visit to the US capital in early September. Investment presentations at the US-Saudi Investment Forum 2015 focused on opportunities for suppliers and investment potential, highlighting the growing need for technology and knowledge.
Technology is seen as particularly ripe for investment. Fadi Saleh, the Saudi Arabia country manager for Etqan Healthcare Medical Solutions, which supplies equipment and support services, is confident that information and integration technology represents the future.
“Everybody is adopting more technology, from going paperless to using cloud computing,” he told OBG. “Telemedicine and remote diagnosis have great potential in Saudi Arabia given the size of the Kingdom and the distance of many people from large urban areas.”
With some estimates putting expected investment in the Saudi health sector over the next five years at around $100bn, the opportunities for service and technology suppliers will be considerable.
According to a report by International Data Corporation, Saudi heath care is the second-fastest-growing IT market in the country after the government sector, forecast to rise by 11% per annum in the five years to 2017.
Private health and medical insurance, which form part of the push to develop a universal insurance scheme in the Kingdom, is another area primed for growth. The national initiative is expected to produce greater opportunities for local and foreign policy providers.
Dr Sami Al Abdulkarim, CEO of Inaya Medical College, is confident that a wide variety of sector stakeholders will benefit from the introduction of a compulsory health insurance scheme.
“The private sector covers roughly one-third of health services, so extending compulsory coverage to all Saudis will be a big benefit for the whole health care sector,” he told OBG. “It will allow more Saudis to access these private facilities, which will in turn improve the overall access to beds.”
Building human capital
While investment in infrastructure and technology is set to raise standards, it could also exacerbate staff shortages. Officials have flagged plans to double the health sector’s clinical capacity over the next five years, adding some 30,000 beds, which will require more skilled medicals professionals.
“As we are building hospitals, we need to work in parallel to develop the sector’s human capital,” Dr Abdulrahman Al Muammar, CEO of King Saud University Medical City (KSUMC), told OBG. “There is a huge staffing gap.”
Overseas workers have historically been brought in to cover the shortfall, with expatriate doctors and pharmacists outnumbering their local counterparts by a ratio of 4:1 and 5:1, respectively, according to the most recent data from the Ministry of Health.
While resolving the shortage of trained Saudi nurses and doctors will be more crucial as the industry expands – with estimates of the staffing deficit ranging from 40,000 to 150,000 – Al Muammar expects the number of graduates from specialty programmes or medical schools to increase by seven- or eight-fold in the coming years.
This is largely thanks to efforts to boost the number of medical schools and training programmes operating in the Kingdom. In the decade to 2008, the country went from having five medical schools to 21, with another seven opening their doors in the intervening years. KSUMC and other teaching centres are also expanding their programmes to further bolster the number of graduating specialists.
Meanwhile, the government is taking steps to make public health care a more appealing profession for Saudi nationals.
Local doctors are disproportionately employed in the private health sector, according to a recent study by Al Imam Mohammed Ibn Saud Islamic University. Less than 25% of Saudi doctors practise in the public system, even though the majority of the country seeks medical care from it. Changing the perception of public health care work and encouraging Saudi doctors to work in clinical instead of administrative capacities could help reverse this trend.
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