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IN the coming years, the GCC healthcare services sector is predicted to witness major improvements in the quality of services rendered and in competitiveness on a global scale.
The region's endeavours in setting up integrated healthcare facilities in the form of healthcare cities and medical hubs, coupled with continuous improvement in technology and infrastructure, will significantly improve the availability and quality of healthcare services in the region.
The GCC healthcare sector is on a growth trajectory. The industry is poised for unparalleled and consistent growth accompanied by a fundamental shift in the industry structure, infrastructure quality, payer model and funding options, says Tommy Trask, executive director and head of Equity Research services at Alpen Capital.
The countries are likely to experience a sharp increase in healthcare needs primarily led by a growing and ageing population and a rise in chronic non-communicable 'lifestyle' diseases.
"We expect the industry to reach a market size of about $47-55 billion by 2020, equivalent to a 9 per cent compound annual growth rate (CAGR)," says Trask.
But, would that CAGR be sufficient to meet the needs of the rising population?
At the current growth rate of about 5 per cent a year, the GCC's 39 million population is on track to double over the next two decades. US management consultant McKinsey & Company predicts the cost of healthcare in the GCC will increase by 240 per cent over the period.
Furthermore, with GCC governments striving to transform their countries into developed economies, the ability to care for the sick and injured in their own modern, world-class facilities will be a key measure of success.
Governments are responding to these challenges with massive hospital building programmes and heavy investment in setting up primary care clinics to increase screening and early diagnosis.
Currently more than $10 billion worth of healthcare projects are under way in the Gulf.
The largest healthcare project under way in Qatar is the $2.4 billion Sidra Medical & Research Centre at Education City. Due to open in 2012, Sidra has been designed as a 'five-star' hospital.
The hospital will initially house 412 beds, but will have the infrastructure to expand this to 550. These facilities will significantly expand Qatar's healthcare system. As of 2007, the country had nine hospitals and 23 health centres employing 9,524 medical staff, 1,775 of whom were doctors.
Meanwhile, Saudi Arabia is building a series of smaller hospitals to improve the coverage of its public health system, rather than concentrating on one or two megaprojects.
Demand for hospital beds in the kingdom is predicted to rise from 50,000 to 70,000 by 2016, driven by an ageing and increasingly wealthy population seeking more specialist healthcare treatments.
In its 2009 budget, Saudi Arabia allocated SR52.3 billion ($14 billion) to its healthcare and social welfare services sector, including the cost of building 86 hospitals with a combined total of 11,750 beds. This represented an 18 per cent increase on the SR44.4 billion allocated in 2008 to set up 250 primary healthcare centres throughout the kingdom, as well as eight hospitals.
Bahrain is also building a new public hospital. The 312-bed, $130 million King Hamad General Hospital is scheduled to open in 2010 in the Muharraq area, to take some of the pressure off the 900-bed Salmaniya Medical Complex, which currently lacks the capacity to deal with a major incident involving multiple casualties.
At a site close to King Hamad General Hospital, the $1.6 billion Bahrain Health Oasis is being developed by Ithmaar Development Company in partnership with the Royal College of Surgeons in Ireland (RCSI). It will host health centres covering diagnostics, nutrition and diabetes, cosmetic surgery, aesthetic medicine, and sports medicine.
But, even as GCC countries continue to develop world class healthcare systems, they must avoid pitfalls of the developed markets, says A T Kearney, a global strategic management consulting firm.
The global health industry is worth around $4.2 trillion and accounts for 10 per cent of the global GDP. It is an industry that has seen a steady growth year-on-year but according to experts is at a point of major change.
The goal of access, choice, patient safety and equality for patients is increasingly hard to maintain in developed countries, as healthcare expenditure has been growing, leading to an ever widening funding gap.
GCC countries currently spend far less on healthcare per capita than the western world, but disease patterns have started to mimic those of the west and that of other developed markets.
It is therefore essential for the GCC countries to avoid replicating the healthcare systems set up in the west and move directly to an integrated healthcare model, where primary and secondary care, along with other healthcare players, work closely together to enhance quality of life and reduce the expenditure of each patient, says Dr Omar Sawaya, principal, A T Kearney Middle East.
"The natural first step for the GCC is to take a look at primary care and define how best to offer and integrate primary care into the overall health care offering for various diseases. Based on this, all other supporting healthcare players will be able to define and further improve their role in creating a world class sustainable healthcare sector in the GCC," says Dr Sawaya.
