Opportunities are expanding in the private health care sector

Although new public hospitals are under development, Oman’s private health care sector is also undergoing rapid expansion, bolstered by population growth, capacity constraints at existing public facilities and rising demand for specialty care. While health care is provided to all Omani citizens free of charge, a dearth of critical care options has prompted the government to fund overseas treatment for some patients, funds which could be used to build up domestic capacity and prevent an outflow of medical revenues.

Recognising this, the government is now working with the private sector to establish two international medical cities in Salalah and Muscat, while recent statements from the Ministry of Health (MoH) demonstrate that these cities are the first of many opportunities for private investment in the sultanate’s health sector.

Private Sector

Although government funding accounts for the majority of health care expenditure, the private sector’s contribution to overall growth has been considerable in recent years. While Oman had one private hospital with six beds in 1995, the total number of private hospitals has quadrupled in the last decade, jumping from three facilities in 2004 to 12 in 2013. The number of private pharmacies expanded by 62% from 331 in 2004 to 537 in 2013, while the number of private clinics increased by 49.5% from 686 in 2004 to 1026 facilities in 2013.

Of the nine new hospitals built between 2004 and 2014, seven are privately owned, while a growing number of Omanis are gravitating towards private medical services. According to a report released by the MoH in April 2014, Omanis comprised 46.8% of the 45,654 patients treated at private medical facilities in 2012.

“The country has struggled with a lack of timely services in some areas, which has contributed in a large way to the growth of Omanis looking to private health care. The other side of this is critical care. There has been a shift in Omanis travelling to other countries in the GCC for their care. Until this government-funded push to travel externally for treatment is curtailed, you cannot build quality infrastructure,” Rajesh Maniyanghat, operations manager at Muscat Private Hospital, told OBG.

For example, the sultanate does not yet offer positron emission tomography (PET)/computer tomography (CT) scans, a hybrid medical imaging process combining nuclear and X-ray digital imaging that is considered critical in the early detection of cancer. A 2013 report published by the Sultan Qaboos University Medical Journal argued that a lack of domestic PET/CT services has hindered the development of specialised services and imposes an economic burden.

“In Oman the importance of PET/CT imaging has been acknowledged for nearly a decade, especially for cancer patients. Due to the lack of PET/CT facilities in the country, patients are being sent abroad at the expense of the MoH,” the report stated.

Medical Cities

Beyond bolstering service offerings, the private sector could also benefit from two international medical cities in Salalah and Muscat. The first, set to be built in Salalah in 2016, has been promoted as a “change agent that will put Oman on the world health map”, and includes a multispecialty tertiary care hospital and three medical centres of excellence for organ transplant, rehabilitation and diagnostics.

Valued at $1bn, covering a total area of 866,000 sq metres and offering 530 beds in total, the Salalah International Medical City is being developed by Apex Medical Group, a subsidiary of Saudi Arabia’s Al Joaib Group. In January 2014 the company announced it had received permits and licences, with the main tertiary hospital expected to be commissioned in 2016 and a formal launch planned for the second half of 2017.

In the longer term, the Sultan Qaboos Medical City will have perhaps the most profound impact on private health care in Oman. The $1.5bn, 5m-sq-metre project will be built in Batinah and is set to include residential space and shopping malls. In 2013 the government announced it had formed a committee to develop Muscat’s medical city, while it plans to float a project management tender for the development before 2015.