By Andy Sambidge
New report says sector expenditure estimated to hit $133bn; set to grow by 10% annually
The GCC's total healthcare expenditure is forecast to triple by 2018, according to a new report by Frost & Sullivan.
Healthcare spend in the region in 2011 was estimated to be $46.12bn and this is expected to reach $133.19bn in 2018, the report said.
Frost & Sullivan said healthcare spending in the GCC is projected to grow at a compound annual growth rate (CAGR) of 10.3 percent from 2010 to 2018 due to its expanding population, higher incidence of lifestyle diseases, and deeper insurance penetration.
“The surge in medical tourism in this region and the escalating disease burden will create a need for 90,690 hospital beds by 2018,” the Frost & Sullivan report said.
“However, opening up a healthcare facility in GCC countries involves numerous complicated processes, which deter possible foreign market entrants,” it added.
Frost & Sullivan said the GCC’s healthcare industry is also pegged back by the lack of educated manpower in the region.
It added that the industry, which is mostly regulated by the government, needs to be opened up to private healthcare organisations by "easing the entry barriers and reducing the complexities of procedures".
The study said that healthcare public-private partnerships (PPPs) have already proven to save governments as much as 25 percent of healthcare costs.
It added that the UAE and Saudi Arabia were the two forerunners in healthcare PPP deals in GCC region.
“Most PPP deals in GCC region are based on the build operate and transfer (BOT) system. More PPP deals in the field of medical, nursing and paramedical colleges can also reduce the GCC’s dependence on expatriate doctors and nurses and generate jobs for citizens,” Frost & Sullivan said.
It noted that rapid urbanisation in the Gulf region was creating ample opportunities for the growth of the healthcare industry.
The oil-driven economic boom in the GCC has increased disposable incomes and per capita spending, which, in turn, has raised the demand for healthcare services.
Indeed. In fact on the quoted figures the CAGR between 2011 and 2018 works out at 16.3%, not the 10.3% quoted. Shoddy work.