Following a decade of investment in both public and private facilities, the health care sector in Ras Al Khaimah is set for major growth in the coming years. The official inauguration of the new Sheikh Khalifa Specialty Hospital (SKSH) in early 2015 represents perhaps the most significant step forward for the emirate’s health care industry, although ongoing investment in RAK’s network of private facilities has also had a dramatic impact on the sector’s landscape.
Demand for new services is rising rapidly – RAK, like the rest of the UAE, is suffering from the rising incidence of lifestyle-related diseases, including diabetes, heart disease and cancer. At the same time, limited local treatment options at public hospitals are driving patients to seek treatment abroad. A third challenge is lack of mandatory health insurance, although such a scheme is reportedly in the works and, if adopted, could open new doors for existing players.
An expanding portfolio of new facilities will offer major benefits for health provision and overall economic expansion, with knock-on benefits extending to RAK residents and local institutions. These include the RAK Medical Health Science University ( RAKMHSU) and Julphar (Gulf Pharmaceuticals Industries), which has grown into a leading manufacturing firm, with plans to expand its operations internationally in the coming years. Although staff shortages and a rising disease burden will continue to challenge stakeholders, they also present considerable opportunities for growth and investment, as envisioned by both Sheikh Saud bin Saqr Al Qasimi, RAK’s ruler, and the UAE’s Vision 2021 National Agenda, which emphasises economic diversification and the development of a knowledge-based economy.
Sector Overview
Development and provision of health care services in RAK is carried out at the federal level through the UAE’s Ministry of Health (MoH) and its local unit, RAK Medical District (RAKMD), which plays an important role in aligning local health policies to the broader national Vision 2021 economic development plan. The MoH has been increasingly active in developing new patient care and service delivery options in partnership with the private sector, as well as establishing mandatory health insurance for residents of Abu Dhabi and Dubai, although a programme for this has yet to be rolled out in RAK.
Public Hospitals
The emirate is home to four public hospitals, Saqr, Shaam, Ibrahim bin Hamad and the Obaidullah Elderly Hospital, as well as the stateowned RAK Preventative Care Medical Centre and RAK Dental Centre. The emirate offered 520 beds in 2013, according to the RAK 2014 Statistical Yearbook, although the recent addition of the federally funded SKSH has boosted the total by 95 beds by April 2015. The hospital’s total number of beds is expected to expand to 248 when fully operational in 2017.
A total of 1152 staff were employed at public hospitals in 2013, according to the RAK 2014 Statistical Yearbook, the most recent year for which figures are available. This includes 177 general physicians, eight dentists, 37 pharmacists, and 595 nursing staff, although this represents a 30.6% decline from 1659 staff in 2012. RAKMD reported 18 primary health care centres in the emirate, employing 76 physicians, 20 dentists and 39 pharmacists. In addition to these facilities, RAK also offers 89 clinics located across various schools, employing 11 doctors and 67 nurses.
Private Hospitals
RAK’s private hospital network consists of RAK Hospital, Al Zahwari Hospital and Al Oraibi Hospital, with the 65-bed RAK Hospital being the pre-eminent private facility in the Northern Emirates. RAKMD reports that the private network employed 102 physicians, seven dentists, nine pharmacists, 124 nurses and 34 technicians in 2013.
Expenditure
RAK benefits from rising nationwide health care expenditure. In a 2014 report the US-UAE Business Council found that total health care expenditure in the country reached $16.8bn in 2013, equating to $1200 per person annually, and putting the UAE among the top 20 countries globally in terms of health care expenditure.
Meanwhile, investment bank Alpen Capital estimates health care spending in the UAE will rise by 13.1% annually until 2018, creating what it describes as “unprecedented” demand, in line with broader regional trends. Global consultancy McKinsey & Company reported in 2014 that demand for health care across the GCC is expected to rise by 240% over the next 20 years, most notably in the areas of cardiovascular (419%) and diabetes care (323%).
Patient Numbers
Patient numbers have risen sharply in recent years, with RAKMD reporting 172,239 admissions at its public hospitals in 2009, and 137,448 private hospital admissions, for a total of 309,687 that year. By 2013 that number had risen to 239,327 private and 395,537 public admissions for a total of 634,864 admissions, representing a 105% increase in just five years. According to RAKMD, the total number of primary care patients in the emirate reached 937,133 in 2014, the most recent year for which figures are available. Of this total, 797,769, or 85.1%, were Emirati patients, although the data did not specify how many were admitted to a hospital.
With the opening of RAK Hospital in 2007, private health services have become increasingly popular in the emirate, despite the fact that Emirati patients are entitled to free health care at any public hospital. The number of admissions at private facilities increased by 74% between 2009 and 2013, according to RAKMD, and rose by 19.3% between 2012 and 2013 alone, from 200,662 patients in 2012.
Staff Shortage
Dozens of new hospitals have opened in the UAE in recent years, the most recent including RAK’s SKSH, Abu Dhabi’s Cleveland Clinic and Dubai’s Thumbay Hospital. While a boon to the sector and development, staff shortages are becoming an increasingly critical issue facing service providers.
Despite recording a 105% increase in hospital admissions between 2009 and 2013, RAKMD reports that staff numbers have shown only a moderate increase and in some cases a decline during the same period. This trend is exacerbating an ongoing shortage of qualified medical personnel that has already had an impact on health operations in RAK.
According to RAKMD, the total number of doctors and dentists at government hospitals rose by 6.1% between 2009 and 2013, from 292 to 310, while patient numbers at public hospitals simultaneously increased by 130%. RAKMD further reports that total staff numbers in the health sector decreased from a high of 1806 in 2009 to 1152 in 2013.
Indeed, the drop in qualified medical professionals is shared across the UAE, with the country suffering from one of the lowest ratios of doctors and nurses per capita in the GCC, according to consultancy firm Colliers International. In 2013 there were reportedly 1.5 doctors and 2.7 nurses for every 1000 residents, according to Colliers. In comparison, the World Health Organisation’s (WHO) European Region reported an average of 3.33 doctors and 8.42 nurses for every 1000 RAK residents in 2013.
Although the introduction of a UAE-wide licensing system, introduced by the health authorities in Dubai and Abu Dhabi in October 2014, will enable doctors in one emirate to work across the UAE, these doctors will still require approval from the respective emirate before practising there. In RAK, where an estimated 1450 personnel are required for full operation of the new SKSH facility, the RAKMHSU represents perhaps the most significant supply of future medical staff.
RAKMHSU
Founded in 2006 with an initial enrolment of 22 students, RAKMHSU has since risen to become a major training ground for medical professionals in the UAE. Enrolment stood at 1120 as of March 2015, and today the university comprises four colleges dedicated to medical, dental and pharmaceutical sciences, as well as a nursing college. In 2011 the university became the first in the UAE to offer a two-year master of science degree in nursing and clinical pharmaceutics, and expanded these offerings in 2014 to include specialisations in paediatric nursing, community health nursing, psychiatric nursing and pharmaceutics, as well as a doctor of pharmacy. The university was also the first to establish a separate clinical pharmacy department in local hospitals.
RAKMHSU’s medical degree programme runs for six years, including three years of clinical training and a one-year internship. Other bachelor programmes span four years, while the RAK College of Nursing offers a bridge programme for diploma students. In September 2014, 170 students graduated at RAKMHSU’s fourth convocation, including 41 medical, 19 dental, 46 pharmacy, and 65 nursing students.
RAKMHSU is undergoing an expansion, including the construction of a new academic block and sports complex on an 11,887-sq-metre plot. This growth will enable RAKMHSU to accommodate its enrolment increase to 1600 students by 2017, with the university expected to become a significant source of new medical personnel for SKSH.
“The university is hoping to have a close relationship with SKSH, which will be a win-win situation; our students can get trained at SKSH, and staff at the hospital can teach at RAKMHSU,” S Gurumadhva Rao, vice-chancellor of RAKMHSU, told OBG. To broaden the experience of its students and staff, the institution has also drafted agreements with universities in Jordan, Malaysia, India and the US, where it can send students to receive short-term clinical training. Every year, RAKMHSU sends faculty to national and international conferences to increase their exposure to the latest medical technology. “All of this will allow RAKMHSU to better meet rising demand for trained health professionals in the emirate,” Rao said.
The emirate’s largest free zone, RAK Free Trade Zone (RAK FTZ), is also set to expand its offerings in a bid to cater to the growing human resource demands. In July 2014, free zone authorities announced plans to construct a new health training centre in the education zone cluster, including a nursing school, labs and a wellness facility, all of which are being established to support the SKSH. Construction on the new facilities is expected to begin by June 2016.
Lifestyle Changes
Urbanisation and disposable incomes have both recorded a sharp increase across the UAE over the previous 15 years, and with these trends, lifestyle-related health conditions, like non-communicable diseases such as cancer and diabetes, have grown into pressing national health concerns. Cancer is the second-leading cause of death in the UAE after cardiovascular disease. The WHO predicts that if the UAE does not adopt preventative screening and early detection programmes, cancer deaths across the UAE will quadruple from 832 in 2008 to 3356 by 2030, while the number of new cases will rise to reach 5914 by the same year. Obesity and diabetes pose another significant threat to public health in RAK. In 2014 the Institute for Health Metrics reported that over 66% of men and 60% of women in the UAE are classified as obese. Regional industry magazine Middle East Health reported that the UAE had the second-highest prevalence of diabetes in the world in 2013, with 20% of residents and 25% of Emiratis living with the disease, and a significant portion remains undiagnosed and thus untreated. Direct health care for diabetes accounts for nearly 40% of total health care expenditure in the UAE, or $6.6bn in 2011. At the same time, diabetics in the UAE have the highest prevalence of heart disease amongst all GCC countries, with Middle East Health reporting that diabetic Emiratis and UAE residents are three times more likely to have a heart attack and four times more likely to have a stroke, and that an estimated 50% will eventually die from the disease.
Specialty Care
Rising patient numbers, ongoing staff shortages, and the growing prevalence of non-communicable diseases have had a profound impact on the availability of specialty care in public sector hospitals, forcing many patients from the Northern Emirates to seek treatment in other parts of the country or abroad. RAKMD reported that in 2013 the emirate’s public hospitals offered just three beds for burn patients, 18 cardiology beds, eight urology beds and four neurosurgery beds to serve the emirate’s population of 438,000. There were no public oncology beds in 2013, and the majority of specialty care offered is found at the 234-bed Saqr Hospital.
With specialty care options for lifestyle-related diseases in limited supply in the public sector, the government has increasingly targeted private health care provision as a strategy to improve patient outcomes, most notably with the launch of RAK Hospital. Perhaps most significantly for specialty patients, the SKSH was officially inaugurated in February 2015, targeting cancer and heart care, with the facility expected to offer 248 beds across a host of specialty segments once it is fully operational in 2017.
RAK Hospital
The 140,000-sq-ft, three-storey RAK Hospital is one of the most prominent private health care providers in the emirate, and is owned by Arabian Healthcare Group (AHG), a joint-venture company formed between the government of RAK and Dubai’s ETA Star Healthcare. Management is provided by Swiss firm Sonnehof Swiss Health.
Positioning itself as a premium health care and hospitality complex, the 65-bed facility was designed by US firm Ellerbe Becket, who also designed Mayo Clinic in the US, and offers three suites, nine super-deluxe rooms and 24 deluxe rooms. Service offerings include eight intensive care unit beds, six nursery beds, four neonatal intensive care units, four operating theatres, one cardiac catheter lab, and 40 outpatient clinics, as well as accident and emergency services. The hospital has seen patient numbers increase by 35% over the last seven years, thanks in part to a growing portfolio of specialty services.
Serivce Expansion
RAK Hospital has been active in expanding its specialty care options in recent months, and in November 2014 opened the first dedicated eye centre in the emirate. The comprehensive facility focuses on a range of areas related to eye and vision health, from sight enhancement to rehabilitation services, and offers services, including cataract surgery, refractive surgery and corrections, glaucoma treatment, and vitreo retinal surgeries, among others.
A number of other specialty services are coming online in RAK Hospital as well. In January 2015 the hospital announced that it had signed a partnership with India’s Shalby Hospitals to introduce a “zero technique” knee replacement surgery that cuts the time spent on the operating table from two hours to 15 minutes. With this new approach, surgeons have been able to serve a much larger patient base, and patient recovery time has been significantly reduced.
The introduction of this new surgery technique is expected to significantly improve RAK’s prospects as a medical tourism hub. “Our inspiration is the Mayo Clinic, because Rochester, New York, is also small, but serves roughly the same population as we do,” Raza Siddiqui, CEO of AHG, told OBG. “Foreign patients are already coming to us for heart and joint treatments, and our new knee replacement surgery is expected to increase this number significantly.”
In April 2015 AHG unveiled a new diabetes treatment centre in RAK, as well as two more in Dubai. The centres will offer access to a multidisciplinary team that includes cardiologists, ophthalmologists, nephrologists, endocrinologists, dieticians and podiatrists, as well as a clinical testing facility.
The Insurance Question
Although the share of private health care in RAK continues to rise, existing private facilities remain constrained by the emirate’s lack of mandatory medical coverage, which many argue would offer significant knock-on benefits to public and private facilities alike. Abu Dhabi was the first emirate in the UAE to introduce mandatory health insurance in 2006, and in November 2013, the Dubai Health Authority announced plans to implement its own mandatory health insurance legislation, with the aim of creating an integrated health network based on a sustainable financing system.
The Dubai Health Insurance Law No. 11/2013 went into effect in January 2014, mandating all employers in Dubai to provide health insurance coverage for employees, although companies were given rolling deadlines to comply: those with more than 1000 employees had until October 2014 to roll out health care plans; companies with 100-999 employees had to provide coverage as of July 2015; and companies with fewer than 100 employees must comply by June 2016.
In the Northern Emirates, plans for mandatory health coverage were announced in 2004 and again in 2007, but have yet to be rolled out, despite warnings from stakeholders that the system cannot expand without such policies. “Private, for-profit health care is technology and capital intensive. You need to have enough money to keep up with technology, which can cost hundreds of millions of dollars, but who is bringing this capital to the table? We have to encourage investment in health care because of the returns that it offers,” Siddiqui told OBG.
In October 2014, sources at the MoH told leading UAE daily The National that plans were under way to introduce mandatory coverage in the Northern Emirates in the near term, although further details have yet to be unveiled. Stakeholders in RAK were nonetheless heartened to hear the news, with many calling for improvements to existing record-keeping practises in order to reduce the challenges facing the federal government in rolling out such a system. “Once mandatory medical insurance is in place here, we will have new challenges. We will need to prevent abuse through data collection and the establishment of gate keepers,” Siddiqui told OBG.
Pharmaceuticals
RAK’s pharmaceutical industry is thriving in the face of unprecedented new demand across both the UAE and GCC, with Julphar now one of the largest pharmaceutical manufacturers in the Gulf region. Established in RAK in 1980 and initially offering just five products, the company has expanded its operations to comprise 12 manufacturing facilities that today produce over 1m boxes of medicine per day. Eleven of these are based in RAK, and in 2013 the company opened a 12th facility in Ethiopia as part of its global expansion strategy.
Julphar currently produces a total of 213 different pharmaceutical products that are distributed to over 40 countries. Julphar is noted for its production of large batches of crude insulin made using crystals derived from recombinant DNA technology, and manufactured at its facilities in RAK.
The company reported steady growth in 2014, with total sales revenues reaching Dh1.43bn ($389.25m), a 5.2% increase year-on-year, driven by 7.5% growth in private market sales. Gross profits rose 3.4% to reach Dh848.2m ($230.9m), operating profits rose 1.1% to Dh238.5m ($64.9m), and net profits rose 2.9% to reach Dh234.7m ($63.9m).
It is expected that the growth in private health care will further bolster sales in 2015; according to officials at SKSH, the hospital plans to capitalise on Julphar’s close proximity in its pharmaceutical procurement, which should make a significant impact on mid-term sales and revenues. “We are fortunate that the emirate contains such a large pharmaceutical manufacturing facility. We expect a very strong collaboration with [Julphar] in the coming years,” MyungWhun Sung, CEO of SKSH, told OBG.
Outlook
With an expanding portfolio of specialty care, rising public and private investment and expenditure, and an intensifying government focus on medical tourism, RAK’s health care segment is expected to see significant expansion in the coming years. The entrance of SKSH into the emirate’s health landscape is perhaps the most promising development to date, and should see an increasing number of national and foreign patients flock to RAK in the coming years. At the same time, new specialty services on offer at both SKSH and RAK Hospital will serve a growing number of patients suffering from increasing prevalence of non-communicable diseases.
Although a mandatory medical insurance scheme has yet to be rolled out and there remain shortages in health care providers, the mid-term forecast is nevertheless optimistic given increased investment and demand. Ongoing expansion at RAKMHSU and RAK FTZ is expected to alleviate the most pressing human resources concerns, while the planned introduction of universal health insurance should help hospitals expand the scale and scope of their operations.
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