The Health Ministry has said healthcare will remain free for citizens even after the privatization of the sector. It denied press reports that the ministry would charge a fee from citizens while providing health services through public hospitals.
Experts said the move to privatize the health sector and introduce a comprehensive health insurance system on citizens was aimed at restructuring the national economy and the public sector to improve the quality of health services and meet requirements of the present phase.
Strong Growth Ahead for Saudi Arabia's Healthcare Sector
Dr. Tariq Al-Fayez, a health insurance expert, said privatization of the health sector would contribute to restructuring the economy and the government sector. “Good management of hospitals will contribute to improving healthcare services,” he told Al-Hayat Arabic daily.
He said the ministry plans to privatize all its services through the National Transformation Program 2020. “This will increase the private sector contribution to the health sector from 25 to 35 percent and change government hospitals to semi-public companies,” he pointed out.
The move will reduce government expenditure on healthcare, improve performance and enhance the internal system to monitor health service and expand private sector contribution toward strengthening the national economy, Al-Fayez said.
There is a plan to privatize about 16 government sectors in the first phase as part of Vision 2030. The government has announced its strategy in this respect after studying seven international experiences and successful models.
Al-Fayez urged the government to enact required laws and regulations to go ahead with its privatization program. “There is a total vision and a partial vision related to privatization,” he said, adding that the total vision restricts the volume of the public sector and its ability to intervene.
Different proposals have been made regarding the privatization of hospitals. First, to privatize management while keeping hospital ownership in the hands of the state. This can be done by signing management contracts with specialized companies.
Another method is to allow hospital workers including doctors and administrative staff to manage the institution. The third is to sell shares through an initial public offering. Selling the hospital totally to the private sector is the most common method.
The provision of health insurance to 20 million Saudis would help insurance companies generate SR50 billion in revenues if they charge a premium of SR2,500 per person. It will also reflect positively on the gross domestic product of the country and increase job opportunities for Saudis.
7 Tips to Keep Health Insurance Costs Down
After the Cabinet’s approval of health insurance, the Health Ministry will set out the necessary mechanism. However, Al-Fayez said he would not support medical insurance at this stage but back selling the service to hospital for a specific amount.
“I would rather support privatization of the primary healthcare centers and transfer of patients from such centers to hospitals,” he explained.
He also insisted that the government should keep specialized medical centers under its ownership to provide advanced treatment at nominal rates.
Abdullah Al-Qahtani, an investor in the health sector, said privatization would improve the quality of health service and bring other benefits.
“We have seen that many hospitals and health centers do not provide good services despite huge government spending,” he told Al-Hayat.
Privatization would bring about competition between hospitals to provide better services to patients, he added.