Saudi’s Healthcare Costs To Rise 30% In 2014

Charges levied by private healthcare providers in Saudi Arabia are expected to rise by 30 per cent in 2014 due to a government decision to reduce working hours and increase nationalisation rates in the healthcare sector, local media reported on Tuesday.

According to the local daily Al Eqtisadiah, private hospitals and clinics in the Kingdom will hike their charges to compensate for the loss in funds due to labour ministry decisions. The paper’s sources were members of the National Health Committee at the Saudi Chamber of Commerce and Industry.

The Kingdom’s Shoura Council recently introduced a law to reduce working hours among private sector employees from 45 to 40 per week, including a two-day weekend in a bid to attract more nationals to the private sector.

The Labour Ministry also raised nationalisation quotas from 25 per cent to 30 per cent in the country’s healthcare sector. Civil Services ministry data showed that Saudi Arabia’s healthcare sector employs the largest number of public sector expat workers due to the unavailability of a qualified local workforce.

In addition, the country’s health minister Dr. Abdullah Al-Rabeeah has also restricted private healthcare institutions from charging patients for solely opening medical files. This is also expected to contribute to the hike in healthcare service costs in the private sector, council members said.

Though the committee welcomed the government’s move to ban such administrative fees, it also urged authorities to introduce cooperative health insurance schemes, which will help in lessening the citizens’ financial burden.

However, Khaled Bin Mikaimen Al-Subaie, member of the medical committee at the Riyadh Chamber of Commerce and Industry, said that the Labour Ministry’s recent decisions, and not the ban on the fees, will cause healthcare fees in the private sector to shoot up.

Saudi Arabia is one of the most lucrative healthcare markets in the world with many local private hospitals issuing stock market listings.

Two of Saudi Arabia’s largest private sector hospital groups, Sulaiman Al-Habib Medical Group and Almana General Hospitals, are said to be planning initial public offers this year, indicating a healthcare boom in the country, according to media reports.

Following the Arab Spring uprisings in 2011, the government has also ramped up its expenditure in healthcare. The country allocated Dhs106 billion of its 2014 budget for healthcare purposes, up eight per cent from its spend in 2013.