The international community proves the great significance of the healthcare sector, which aims to present people with an opportunity to lead a healthy lifestyle by providing that everyone has access to high-quality professional treatment.
Saudi Arabia accounts for 60% of the Gulf Cooperation Council (GCC) countries’ healthcare expenditure, and the sector stays a top priority for the Saudi Arabian Government. In 2022, it spends about $36.8 billion on healthcare and social development – 14.4% of its 2022 budget.
The Current Situation in the Market
Saudi Arabia experiences growing demand for healthcare services due to increasing per capita public health expenses, demographic structure changes, and the rising numbers of patients with chronic illnesses. Moreover, people are getting more conscious about their physical and mental health, which makes investing in this promising sector even more appealing.
Healthcare Sector in Saudi Arabia
Lately, the Ministry of Health has privatized healthcare services in the Kingdom. The medical institutions will act independently of the Ministry and become public institutions competing in professionality and efficiency. The Ministry added that the benefits would be combined. All primary care, general and specialized hospitals will provide citizens with comprehensive and effective treatment and prevention.
Privatizing and adopting the private sector’s methods in the promotion of quality improvement, increasing productivity, waste reduction, accelerating the decision-making process, and decentralization will lower the administrative and financial burdens of the government.
The contract between parties will regulate healthcare services. This contract model implies a low risk for the customers’ thanks to well-defined requests and fixed project management methodologies.
However, after the agreement is signed, any changes in the scope would cause a modification in cost and timing. Therefore, it is essential to negotiate each feature and appraise the reasonable price for the project implementation at the first set-out.
An outsourcing company and a customer can fix up periodic payments. The agreement may settle the specific sum of the overall price that customer pays after each stage of treatment during the project.
Undoubtedly, privatization is a positive process and might be a better option to deal with financing and prevent losses. Privatization should also improve the operations of medical institutions through good governance and close observation of their financial affairs while seeking continued profitability in the highly competitive environment.
The medical institutions will have no other options to draw patients’ attention but to provide competitive services that meet the highest international standards. That also means the availability of the most up-to-date medical equipment and the best medical staff.
Under the privatization process, a holding organization with about 30 subsidiaries will be set up to control the management and performance of 276 hospitals and 2,300 health centers, which have to be detached from the Health Ministry and governed by special-purpose private organizations.
Furthermore, proceeding with privatization is predicted to attract more investments into healthcare-related projects all over Saudi Arabia, in particular, progressive medical devices and equipment. A total of $2.1 billion is expected to be invested in infrastructure projects for health equipment and devices by 2023, with annual expenses growing from $180 million to $250 million by 2022.
Saudi and International leaders focused on advanced medical technologies in KSA under the Vision 2030 program.
First Steps and the Outlook
The process has already taken off, and some noteworthy projects are highlighted.
Dar Al-Hijrah is one of the significant projects under construction in the city of Madinah that will include a hospital for 400 beds, among many other services for pilgrims. The Prophet’s Mosque is located nearby.
The Batterjee Medical City in Dammam is expected to be the establishment of a 150-bed private hospital with the newest medical equipment covering all specialties in compliance with the global best medical practices. The area of the project will be 550,000 sq. meters. Fully functional, it will provide high-quality, specialized services to people throughout the Eastern Province and patients from Kuwait and Bahrain.
Saudi and International leaders focused on advanced medical technologies in KSA under the Vision 2030 program. The main tasks of the conference were to upgrade record keeping in medical companies and to encourage clinics to invest wisely in documentation enhancement.
John Daniels, the Global Vice President for HIMSS Analytics, focused attendees’ attention on Electronic Medical Record Adoption as the key to success for medical institutions that are concentrated on providing efficient healthcare services.
Dr. Mustafa H. Qurban, Consultant and CIO of King Fahd Military Medical Complex, argued that the IT role in medicine would become a primary service function that is more engaged in business operations and strategy.
That means IT specialists must be integral to the everyday decision-making process related to patients.
Whatever the final destination of the healthcare system in Saudi Arabia, the future will be exciting. The challenges of radically changing the direction of a healthcare system are daunting. Still, it appears that Saudi Arabia needs political will to begin this process. These changes will directly impact the health and well-being of its population, and it is paramount that continued monitoring and adjustments be made as this complicated process goes forward. Contact us to know more about the healthcare industry and its peculiarities.