Health care is central to Saudi Arabia’s long-term development plans, with the sector guided by its own dedicated Vision Realisation Programme (VRP) under Vision 2030, the Kingdom’s blueprint for socio-economic transformation. Advanced health care infrastructure is in place, and the government is actively seeking to further modernise the sector and enhance efficiencies through digitalisation and private sector involvement.
Public health care services are provided free of charge to Saudi citizens, without the requirement for individual contributions. The public health care network consists of hospitals, primary care centres, and other institutions such as military or university hospitals, ensuring widespread distribution of health services across the country. Non-citizen residents are mandated to obtain private health insurance, which has contributed to the development of a vibrant private health care segment. As the sector continues to evolve, opportunities are opening up for the creation of specialised health care clusters to support the changing needs of the population, while financing mechanisms are being evaluated to make the sector more cost-efficient.
Regulation & Oversight
The 2002 Health Law codified the authority for the sector, the Ministry of Health (MoH), which provides health care, promotes public health, monitors performance, supports research and – until recent reforms – was solely responsible for providing public health care services. The MoH is headed by the minister of health, Fahd bin Abdurrahman Al Jalajel, who is supported by two vice-ministers – one for health affairs and one for planning and development – with a further seven deputy ministers and 22 agencies overseeing various functions. The ministry is guiding progress under the aforementioned VRP, the Health Sector Transformation Programme (HSTP), which aims to improve health care by focusing on prevention, access, lifestyles and workforce development.
The 1999 Cooperative Health Insurance Law mandated health insurance coverage for all non-Saudi private sector employees and established the Council of Cooperative Health Insurance (CCHI) to oversee the implementation and regulation of private health insurance. Elsewhere, the 2006 Patient’s Bill of Rights outlined the rights and responsibilities of patients and health care providers, with the aim of ensuring access to quality care and protecting patients’ rights. Building on this, the 2005 Law of Practising Health Care Professions codified the requirements for working in the field and established the Saudi Commission for Health Specialties to license and regulate sector professionals.
The pharmaceutical industry is overseen by the Saudi Food and Drug Authority, which was established in 2003 to ensure the safety of pharmaceutical drugs, electronic medical devices and food in the Kingdom. Two important regulations that govern the registration and pricing of pharmaceutical products are the Registration Rules of Pharmaceutical, Herbal and Health Product Manufacturers and their Products and the Pricing Rules for Pharmaceutical Products. Additionally, the 2004 Law of Pharmaceutical Establishments and Preparations governs the manufacturing, importation, distribution and sale of pharmaceuticals.
To strengthen supply chain management in government hospitals, the National Unified Procurement Company (NUPCO) was established in 2009. NUPCO is fully owned by the Public Investment Fund and serves all MoH, National Guard, Ministry of Interior and university hospitals, as well as specialised medical facilities. One of its main responsibilities is to facilitate the procurement process for health care supplies and equipment on behalf of the government. Looking ahead, NUPCO aims to engage with the private sector to enhance efficiencies in the supply chain (see analysis).
Policy & Strategy
Underpinning the government’s overall health care strategy, the HSTP is dedicated to restructuring the health care system and fostering a holistic and integrated approach that revolves around individual and societal well-being. By prioritising value-based care, enhancing health care quality, stimulating competition among providers and attracting foreign investment, the programme aims to contribute to the realisation of the broader goals of Vision 2030. Medium-term targets under the HSTP include inclusive health service coverage for 88% of the population by 2025 – including those in remote and rural areas – and the implementation of a unified digital medical records system for 100% of the population by the same year.
The MoH is in the final year of its 2019-23 strategy for the sector, which is the successor to its previous 10-year strategic plan initiated in 2010. The current strategy has been implemented during a period of disruption resulting from the 2020 onset of the Covid-19 pandemic. It is focused on creating a more patient-centred health care system that is better attuned to the evolving needs of the population.
In line with the HSTP, health authorities have been working to establish up to 30 health clusters across the Kingdom to enhance health care access in all regions, with each cluster serving between 1m and 2m people. As of early 2022 the number of clusters established had already reached 20, and the government was working to involve the private sector to assist in their formation, management and operation.
To accelerate this process, in 2022 the government established the Health Holding Company (HHC), which absorbed all the MoH’s assets related to health services. The HHC is tasked with overseeing the development and operation of the various clusters around the country in partnership with the private sector, with opportunities opening up for private firms to address gaps in areas such as digital innovation and specialised care in particular. The HSTP delivery plan lists nine areas where the private sector is targeted to play a major role in the transformation of the health system: rehabilitation, long-term care, home care, pharmacy, extended care, primary care, radiology, laboratory services, and service provision for hospitals and medical cities.
In May 2023 the National Center for Privatization & PPP reported that 424 expressions of interest from companies in 21 countries had been submitted for three public-private partnerships (PPPs) with the MoH. The projects included the design, development, financing, maintenance and operation of a 200-bed long-term nursing home, and a 100-bed nursing care centre in Riyadh’s Second Health Cluster; the design, development, financing, maintenance and operation of hospitals with capacity for 150 beds and 120,000 outpatient therapy sessions in Dammam’s First Health Cluster; and home health care for 5000 current patients.
Budget & Expenditure
The health and social development sector was allocated a budget of SR189bn ($50.4bn) for 2023. Although this was a contraction of 4.5% from the previous year, health and social development still received the second-highest allocation of the national budget after the military. The MoH received a 7% annual budget increase, rising from SR77.6bn ($20.7bn) in 2022 to SR80.8bn ($21.5bn) in 2023. This is in line with allocations in past years, as the MoH’s budget has increased by 6-8% every year since 2007.
Despite inflationary pressures and global economic risks, the Ministry of Finance expects minimal disruption to planned health projects in 2023. While uncertainties exist, previous resilience and oil reserves mitigate potential risks, although some disruption may occur due to global pricing pressures and supply chain issues related to pharmaceuticals and medical devices. Major health care projects planned for 2023 under the MoH budget include the inauguration of two hospitals with a combined capacity of 900 beds; electronic archiving of cardiac images and the linking of heart centres to a central diagnostics system; adaptation of four main hospitals for elderly services; reaching 20m beneficiaries through “a-doctor-for-every-family” model; increasing the number of non-profit organisations providing community health programmes from 215 to 230; and launching 60 mobile clinics to reach a primary care coverage rate of 88%.
Health Indicators
As funding for health care has grown, Saudi Arabia has observed positive trends in public health indicators. Life expectancy at birth increased from 69 years in 1990 to 77 years in 2022. Meanwhile, the infant mortality rate decreased from 44.3 deaths per 1000 live births in 1990 to 6.7 deaths per 1000 live births in 2021, and the maternal mortality rate fell from 22 deaths per 100,000 live births in 2000 to 16 deaths per 100,000 live births in 2020. A 94% rate of prenatal care utilisation by Saudi women has likely lowered maternity and infant mortality rates.
Rising disposable incomes and international influence have contributed to more sedentary lifestyles and less healthy dietary choices. In turn, there has been a growing prevalence of non-communicable diseases (NCDs). The International Diabetes Federation estimates the prevalence of diabetes among adults in Saudi Arabia to be 17.7%, with a total of 4.3m cases. Obesity is recognised as a major contributing factor to the development of diabetes, and there is increasing concern regarding obesity rates within the Saudi population.
The impact of obesity on public health and the economy is significant. In Saudi Arabia, these conditions contribute to the occurrence of NCDs such as heart disease, stroke, Type 2 diabetes and several types of cancer. Obesity is responsible for some 27% of NCD-related deaths and 15% of NCD-related disabilities in the country. The government spends an estimated $3.8bn directly on obesity-related expenses, accounting for 4.3% of health care costs. Part of this expense is attributed to the 28 MoH diabetes centres and 221 renal dialysis centres and units.
The government aims to increase the average lifespan of citizens to 80 years by 2030. One of the main ways it plans to achieve this is by focusing on preventing NCDs. The MoH’s Public Health Authority, with support from the World Bank Group, published a comprehensive report in 2021 outlining effective interventions for prevention. By addressing risk factors such as obesity, high blood pressure and high cholesterol, and promoting healthy lifestyle changes among young people, it hopes to reduce the prevalence of these diseases and their associated health problems.
Oncology Advancements
Colorectal cancer has emerged as the most prevalent type of cancer in the Kingdom, accounting for 14.4% of all newly reported cancer cases in 2020. Breast cancer closely followed, at 14.2%, while thyroid cancer ranked third, at 10.2%. It is worth noting that colorectal cancer primarily affects men, while breast cancer predominantly affects women. The mortality risk associated with these cancers stands at 5.4% for both genders. The total number of new cancer cases reported in 2020 was 27,885, underscoring the significance of efforts to enhance prevention, early detection and treatment.
As of 2021 the Kingdom had four public oncology centres located in Riyadh, Makkah, Qaseem and the Eastern Province. In the first quarter of 2023 Saudi-owned Almana Group of Hospitals announced the opening of a new private oncology centre in Dammam, in the Eastern Province, with a particular focus on preventive measures such as mammograms. Among the public initiatives to fight against cancer, the National Cancer Control Plan was launched by the MoH in 2014 and its implementation phase runs through 2025. Its goal is to lower the number of cancer cases by promoting healthy lifestyles, early detection and better access to health care services.
King Faisal Specialist Hospital & Research Centre is a prominent medical institution specialising in oncology that offers comprehensive care for patients, from diagnosis to follow-up. Additionally, the non-profit Saudi Cancer Foundation plays a crucial role in raising awareness and supporting patients and their families. Overall, these efforts aim to reduce the impact of cancer in Saudi Arabia and improve the lives of those affected.
Facilities
The provision of health services can be divided among three categories of entities: the MoH; other government sector players, such as military and university institutions; and the private sector. In 2021 – the most recent year MoH data was available as of August 2023 – the public sector operated 338 hospitals and 59,335 hospital beds in the Kingdom, up from 329 hospitals and 55,359 beds in 2017. Breaking down the 2021 figures, the MoH was responsible for 45,330 beds, or 76.4% of total public sector beds. In contrast, the private sector was responsible for 3732 medical complexes, 159 hospitals and 17,889 hospital beds. Figures for the private sector have changed little since 2017, when it operated 158 hospitals and 17,662 beds. However, the number of private medical complexes increased by 35% between 2017 – when the total stood at 2767 – and 2021, illustrating the trend of private sector operators moving into more specialised areas.
Overall, the public sector was responsible for 77% of all hospital beds and 68% of all hospitals in the Kingdom in 2021. This difference could be attributed to the fact that private hospitals generally have smaller capacities, typically around 65 beds, whereas public hospitals are better equipped to handle larger volumes and tend to have an average of approximately 135 beds. The highest concentration of hospitals is found in Riyadh, and the majority of cases referred to government or specialist hospitals within the country are directed towards Riyadh and its health clusters.
Human Resources
One of the main objectives of the HSTP is to strengthen national capabilities in all major specialties and ensure a fair distribution of skilled health care workers throughout the Kingdom based on local needs. To achieve this, the authorities are encouraging qualified Saudi health workers who have left the country or the profession to rejoin the domestic health workforce, while also striving to improve the attractiveness of health care professions.
The proportion of Saudi doctors in the physician pool has notably increased since 2017, when the total number of doctors practising in the Kingdom stood at 23,420. Of these, 1803 were Saudis, representing 7.7% of the total doctor cohort. In comparison, in 2021 the total number of physicians stood at 28,167, of which 3876 were Saudis, representing 13.8% of the total. A similar trend is apparent in the nursing profession. In 2017 the 2625 Saudi nurses working at the time represented 5.9% of the 44,417 total pool of nurses; in 2021 there 3274 Saudi nurses out of 47,989 total nurses, representing 6.8% of the nursing pool.
The government introduced two key localisation measures effective from April 2022. The first decision was to introduce a target of 60% Saudiisation of jobs in medical laboratories, radiology, physiotherapy and therapeutic nutrition in all medical facilities in the Kingdom. The second decision involved the introduction of Saudiisation quotas in professions related to medical devices, including engineering and technical roles, and sales, advertising and distribution.
Investment
The drive to expand and develop regional health clusters under the HHC should provide opportunities for further private investment in the sector. These clusters have been granted autonomy to provide and manage health care services in their designated area, which includes leveraging private sector companies to address gaps in service provision and fulfil technological needs. Private sector involvement is supported by the 2021 Private Sector Participation Law, which provides a framework for PPPs and establishes the obligations and rights of both public and private sector entities in such arrangements. As of August 2023 the private sector’s contribution to overall health expenditure constituted less than 15% of the total, but this proportion is expected to grow as privatisation and modernisation plans gather pace.
In particular, the strong strategic focus on digital health care innovation is creating opportunities for the private sector. A notable example is the 2021 agreement between Proximie, a global health tech company based in the UK, and Saudi technology solutions company Inma, which enables surgeons to participate virtually in surgeries taking place in the Kingdom from any location, providing real-time access to top-tier expertise. This innovative service is designed to improve patient outcomes and facilitate knowledge exchange among physicians, fostering continuous advancements in health care practices. The private sector’s involvement in the health care industry goes beyond financial investment, with global pharmaceutical companies such as AstraZeneca and Pfizer making commitments to expand their research and innovation activities in the Kingdom in collaboration with local partners.
In June 2022 Bandar Alkhorayef, the minister of industry and mineral resources, unveiled a $3.4bn investment opportunity with a focus on localising vaccine, plasma and insulin technologies, reducing import reliance and fostering domestic capabilities. The initiative includes expanding children’s vaccines, insulin production and plasma collection centres, with plans for advanced immunological and cancer treatment technologies. The goal is to transfer knowledge, establish international-standard industrial platforms, and enhance pharmaceutical and health security while positioning Saudi Arabia as a globally competitive player in this area.
Insurance
Private health insurance is mandatory for all non-Saudi residents, which contributes to health being the largest insurance segment in the Kingdom. Citizens receive free health care at public hospitals. Typically, employers arrange health insurance for their employees, including group coverage for multiple individuals. However, individuals can also purchase policies if their employer does not provide coverage or if they desire additional benefits. Private health insurance packages include general practitioner and hospital treatment, emergency care and maternity costs.
With a view to making the financing model for public health care more cost-efficient, in 2022 the government established the National Health Insurance Centre (NHIC) alongside the aforementioned HHC. The plan is for the NHIC to purchase health services from the HHC or its subsidiaries as the process of transferring services from the MoH gathers pace. The NHIC has been tasked with devising a comprehensive health insurance vision for citizens and submitting it to the Strategic Committee at the Council of Economic and Development Affairs for approval. Although a timetable for this process has yet to be publicised, it could signal a significant revision of the public health system funding model in the years to come (see Insurance chapter).
The health insurance segment grew by 26.8% in 2022, contributing 59.7% of total gross written premium. Meanwhile, the National Platform for Health and Insurance Exchange Services was launched in 2022 by the CCHI and the National Health Information Centre as a centralised platform for managing health insurance information and services. The launch of this platform is evidence of the increased digitalisation of the industry. This is being driven by the use of technology in health care, as well as the growing demand for convenient and efficient ways to purchase and manage policies. Alongside consolidation, the priority area for development at the corporate level is technology, with digitalisation seen as the answer to multiple challenges.
The pace of digitalisation in the insurance sector worldwide sped up with the onset of the pandemic, which prompted insurers to adopt digital options and tools. For example, Bupa Arabia for Cooperative Insurance launched a dedicated digital transformation department in 2018 and introduced a telehealth platform in 2020 for online appointments and virtual consultations, improving access and convenience for members through services such as online appointment booking, and online health consultations between patients and medical practitioners.
Life Sciences
As part of its efforts to develop new non-oil growth engines, Saudi Arabia is expanding its life science and biotech industries. The Kingdom hosts advanced research institutions that foster a collaborative environment among academia, industry and government entities. Notably, King Abdullah University of Science and Technology (KAUST) offers high-tech facilities that attract researchers from around the world. For example, the KAUST Smart-Health Initiative spearheads pioneering research in health and medicine. The initiative explores a wide array of innovative solutions, including the development of plant-based antimicrobials, the creation of advanced pathogen detection sensors and advancements in stem cell research..
In an effort to position itself as a global leader in life sciences, Saudi Arabia held the January 2023 Riyadh Global Medical Biotechnology Summit, expressing its aspiration to become a regional centre in the field of biomedical technology. The government views the life sciences sector as an avenue for addressing a range of pressing socio-economic challenges faced by the Kingdom and its international peers.
In 2022 Crown Prince Mohammed bin Salman bin Abdulaziz Al Saud announced the country’s priorities for research, development and innovation (RDI) for the next two decades, the most important of which was health and wellness (see Innovation chapter). The Kingdom is focusing its efforts on extending lifespan by addressing prevailing medical challenges, ensuring health equity through digitalisation and applying international biotech solutions. Such activities will be coordinated by the newly formed RDI Authority, which will develop programmes and projects, and distribute funding to research institutions and companies.
In line with this, in June 2023 KAUST inked an memorandum of understanding with PATH, a US non-profit organisation, to cooperate in areas linked to health and wellness national research priorities. The agreement is focused on vaccine manufacturing; developing digital health systems, solutions and practices; establishing a biobank at KAUST; creating an ecosystem to commercialise technologies developed by KAUST; addressing the health impacts of climate change; and training in smart health programmes.
Outlook
Vision 2030 is driving changes in the health care sector, with a focus on holistic care and well-being. Significant progress has been achieved through the HSTP, leading to an increase in health care facilities and digital innovation. These advancements have elevated the quality of health care services and yielded better patient outcomes, which is demonstrated by improving national health indicators. Saudi Arabia’s dedication to long-term development and proactive measures in addressing health issues provide an optimistic outlook for the health care sector. This is particularly apparent through the government’s commitment to attracting private investment and diversifying the sector through the development of specialised services. This continues to generate strong interest from international players, fostering a collaborative environment for medical advancements and new technology.
The strategic privatisation of health care entities has had a tangible impact on the sector and will continue to expand in the future, playing a pivotal role in driving progress. By easing the burden of public spending, increased privatisation empowers the sector to innovate and operate with enhanced efficiency. In alignment with Vision 2030, efforts to invest in infrastructure, research capabilities and digitalisation are proving to be a key factor for sustaining the sector’s growth and enhancing the health and well-being of the population.
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