Public Private Partnership to drive healthcare investments in Saudi Arabia: report
The Saudi Arabian government continues to focus on the healthcare sector by launching several initiatives that are expected to drive private sector involvement and investment, according to a recent Knight Frank report.
The initiatives include the commencement of the first Public Private Partnership (PPP) project by the Ministry of Health, which targets radiology and medical imaging services in the Riyadh region, in addition to an increased focus on enforcing the mandatory health insurance for all companies operating in the private sector.
“Overall, we are witnessing continuous efforts and further initiatives in favor of increased private sector involvement and investments in the healthcare space,” the consultancy said.
The healthcare and social development sector has maintained its position as the third largest recipient of government expenditures with the budget amount allocated for the sector rising by 8 percent to SAR 172 billion in 2019, compared to SAR 159 billion in 2018.
That said, the supply-demand gap and changing demographic dynamics, and epidemiological profile provides a promising growth outlook in the long-term care (LTC) segment. The consultancy estimates a bed gap of at least 7,000 to meet current demand levels, while industry players estimate the shortage between 10,000 and 13,000 beds.
To put this into perspective, the Kingdom has one rehabilitation bed per 130,000 people, indicating a 10x supply required to be in line with developed nations such as UK and USA, said Dr Gireesh Kumar, senior manager in the healthcare and education consultancy team at Knight Frank Middle East.
Knight Frank also projected demand growth rates to accelerate as the over 60s population is expected to increase by three times between 2018 and 2035, resulting in demand for additional specializations within the LTC sector due to the rise in chronic diseases.