Plans to introduce compulsory health insurance in Ras Al Khaimah (RAK) are expected to usher in a wave of new private sector investment, a response to a forecast rise in demand for specialised services. To do so, the emirate is also stepping up efforts to attract and retain trained staff in an increasingly competitive market.
According to a report compiled by international research firm RNCOS, the UAE’s health industry is projected to expand annually by more than 16% up to 2014, giving it a net national value of around $14.6bn. Though RAK’s health sector represents only a fraction of the national total, it is also expanding rapidly to meet the emirate’s needs. However, while its contribution to the economy is on the rise, so too are expenses and salaries, which means the emirate has to compete with other agencies for experienced professionals and investment in new infrastructure.
In response to rising health costs, the government is expected to introduce a compulsory health insurance scheme, similar to measures taken by Abu Dhabi in 2005 and those currently underway in Dubai. While the plan has been in the pipeline for a number of years, some in the industry are forecasting the programme will be launched in 2013.
Residents would be able to seek treatment at either state or private health facilities under the new system. By introducing choice into medical treatment, it is expected there will be an increase in the quality of health care, as well as a boost in competition within the health insurance segment and a reduction in government spending on health.
According to Raza Siddiqui, CEO of the Arabian Healthcare Group (AHG), which operates RAK Hospital, the introduction of mandatory medical insurance will create a range of investment opportunities for the private sector.
“As soon as Emiratis start having private insurance, they will prefer to go to private facilities that can provide more customised care,” Siddiqui told OBG in a recent interview. “Therefore, the opportunity that will be generated for private investment when medical insurance becomes mandatory is very significant, not only for private hospitals, but also for clinics, specialty centres, pathology labs and medical equipment.”
Compulsory health insurance will also prove a boon to policy writers, with regional insurers expecting a marked increase in trade, which in turn could push down premiums due to higher volume and greater competition. While mandatory insurance may encourage investment and reduce costs within the health sector, it will not directly solve one of the industry’s bigger concerns – the shortage of professional staff. At present, both private and public health facilities are having difficulty hiring and retaining personnel, particularly Emirati nationals.
The federal government is responding to this problem, however, announcing in mid-February that it would sponsor 50 UAE students per year to undertake nursing studies as part of a wider programme to encourage higher levels of Emiratis to enter the medical profession. According to Ministry of Health (MoH) data, only 3% of nurses in the UAE are locals, with less than one-third of these working in MoH facilities.
The RAK Medical and Health Sciences University (RAK-MHSU) will be part of the MoH’s solution, following an agreement that will open up more places for local students in the RAK-MHSU’s nursing school. The MHSU is also offering scholarships via the Saqr Foundation for Government Excellence to Emirati students in the medical and dental fields, with tuition fee reductions for students who earn a grade average of higher than 90%.
“The sponsoring of nationals by the Ministry of Health for the nursing programme will help address concerns over the shortage of nursing professionals not only in RAK but in the UAE,” S Gurumadhva Rao, vice-chancellor of RAK MHSU, told OBG. “Given the growth of the health sector in this emirate, these type of programmes are essential not only to attract more students into the field of health and medical sciences, but also to ensure high-quality health professionals in our emirate.”
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