How private providers and population trends are influencing health care in Dubai

One of the most rapidly expanding markets in the region in recent years, Dubai’s health care sector is set for further growth, driven by an expanding and ageing population, changing medical needs and a determination by the government to provide all citizens with the best possible health care. Both inpatient and outpatient markets are widely forecast to see double-digit expansion leading up to 2022, while subsectors such as medical tourism continue to gain momentum. At the same time, investment in new technologies is gathering pace, with Dubai seeking to become a global leader in high-tech medical applications and digital services, like telemedicine.

While prospects are good, the path to growth is not without its challenges. Finding and retaining health care professionals is one issue facing the sector (see analysis), as is ensuring balanced health insurance coverage. Nonetheless, with Dubai’s authorities determined to bring both private and public, national and international expertise to bear, the next few years should see a significant surge in both health care coverage and market opportunity.

Structure & Oversight

As one of the seven emirates that make up the UAE, Dubai’s health providers are subject to both federal and local regulations. At the federal level, the main sector body is the Ministry of Health and Prevention (MoHP), headed by the minister Abdul Rahman bin Mohammed Al Owais. MoHP is responsible for overseeing the implementation of health care policy throughout the UAE, although as the sector has developed its direct role in heath care provision and regulatory oversight has been limited to the northern emirates, namely, Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah and Fujairah. MoHP also licenses and controls the prices of drugs across the UAE and plays a key role in health monitoring and data collection.

Over the past decade or more, direct health care provision and oversight has been gradually devolved to a number of emirate-level authorities. The process began in Abu Dhabi and Dubai in 2007 with the creation of the Health Authority - Abu Dhabi and the Dubai Health Authority (DHA). In the years ahead it is likely that a Sharjah health authority will be established with similar status.

Stated Aims

The DHA’s mission is to ensure high quality and open access to health services, and improve the health of nationals, residents and visitors alike. A key focus is the promotion of efficiency and innovation within the sector, in line with the objectives of Dubai Health Strategy 2016-21 and the national development strategy UAE Vision 2021.

The DHA operates a total of four hospitals: Dubai Hospital, Rashid Hospital, Latifa Hospital for Women and Children, and Hatta Hospital, as well as specialty centres, such as the Dubai Diabetes Centre, and 14 DHA primary health centres (PHCs). According to local media reports, four more PHCs are expected to open in early 2019, with a number of others in the pipeline up until 2021.

The emirate is also home to a large number of private sector medical facilities, with providers such as NMC Healthcare, Mayo Clinic and Mediclinic Middle East, among others, present in the market. Local authorities are very keen to encourage international and domestic private investors and are targeting an eventual balance of 30% public and 70% private health expenditure. Between 2010 and 2017 the number of private hospitals in Dubai increased from 21 to 31, according to the DHA’s 2017 annual report, and is expected to rise to 38 by 2020.

Investment

To encourage more private participation in the sector, in 2018 the DHA’s Investments and Public-Private Partnership Department launched its Health Investment Strategy 2017-21. The plan has identified a range of priority areas for investment, including ambulatory care, home-based care, mental health, chronic disease management and long-term extended care – all services key to meeting the needs of Dubai’s expanding and aging population.

Change in Governance

That year also saw the approval of a new organisational structure for the DHA. The authority’s new structure includes two new entities – the Dubai Healthcare Corporation (DHC) and Dubai Health Insurance Corporation (DHIC) – and three new strategic sectors, namely: strategy and corporate development; health regulation; and joint corporate support services.

Under the new structure the DHC will manage and operate all government health care facilities, which will be organised into three subsidiary sectors: PHC services, specialised health care services, and medical support services and nursing.

In terms of PHC services the DHC will oversee the development, execution and review of all relevant policies and procedures, including the management of human resources and overall quality of its workforce. For specialised care it will take charge of a range of services for the community, including laboratory surveys, diabetes and psychological tests, the storage of newborns’ umbilical cords, sterility and fertility treatments, and the development of strategies for addressing sterility rates.

Lastly, within the medical services support and nursing subsector, it will manage laboratory and radiology services as well as the DHA’s pharmaceuticals services, including the development of regulations and policies for the pharmaceuticals sector, and the professional development of pharmacists registered with the DHA. DHIC, meanwhile, will be responsible for providing citizens with improved access to insurance coverage and increasing the number of quality insurance policies available to them.

The DHA also has an important regulation and enforcement function, ensuring standards are met and complaints followed up. The authority’s legal actions can range from closing facilities and terminating licences to issuing warnings and enforcing re-evaluations. In 2017 the authority received 357 medical complaints and issued 261 fines to private medical facilities, a number well down on the total for 2016, when 496 fines were levied. The DHA attributed this decrease to the modernisation of its monitoring systems and the increased provision of quality services by private health facilities.

Healthcare City

Another important body in the sector is Dubai Healthcare City Authority (DHCA), which governs Dubai Healthcare City (DHCC). Launched in 2002, DHCC has approximately 160 clinical partners and some 200 retail and non-clinical outlets. It is also home to the Mohammed Bin Rashid Academic Medical Centre, an academic institution which includes the Mohammed Bin Rashid University of Medicine and Health Sciences, the Al Maktoum Medical Library and the Khalaf Ahmad Al Habtoor Medical Simulation Centre.

DHCC is regulated by DHCA-Regulatory (DHCR), which is accredited by the International Society for Quality in Health Care. DHCR is also now the accreditation authority for health facilities located in the zone. Companies that decide to locate to the DHCC receive the benefit of a one-stop shop for visas, licences, company incorporation and a range of other services. Various tax benefits and other financial incentives are also on offer. At present the city is progressing to its second phase of development, with a 2m-sq-metre area dedicated to wellness, residential and hospitality facilities currently under way near Dubai Creek.

Plans & Programmes

To achieve the goal of providing all UAE citizens with modern health care, which is the overarching aim of the health pillar of the UAE Vision 2021, Dubai’s health authorities are collaborating with the federal government to ensure that all public and private hospitals in the emirate are accredited according to national and international quality standards. Currently, all of the DHA’s hospitals and primary health care centres are internationally accredited by the Joint Commission International, and in mid-2018 Humaid Al Qutami, director-general of the DHA, told local media that 96% of hospitals in the emirate were internationally accredited, up from 80% in 2015.

Accreditation is a key part of Dubai Health Strategy 2016-21, which aims to make the emirate a global leader in the delivery of health care. The strategy is aligned with the goals of Dubai Plan 2021, the emirate’s economic development blueprint, and has been developed with the support of health professionals from the public and private sectors, as well as various community bodies and DHA employees.

The strategy has six main objectives: position Dubai as a global medical destination; direct resources to ensure a healthy and safe environment; promote public and private collaboration; foster innovation; revamp the DHA’s governance structure; and establish an efficient decision support system by integrating data platforms. The plan also includes 15 strategic programmes to be carried out in the following areas: care model innovation; lifestyle and prevention; public health and safety; primary care; oral and dental care; mental health; chronic disease management; centres of excellence focusing on a range of specialties; medical tourism; excellence and quality; governance; education; technology; insurance; and investments and partnerships. Each programme has been broken down into a large number of associated initiatives, which together number 100.

Implementation of the strategy is reportedly going well, with the DHA announcing in mid-2018 that, in addition to successfully completing the reorganisation of its governance structure and increasing the number of internationally accredited institutions, it had expanded the total number of health professional licences and health facility licences issued.

Moreover, since the sector began phasing in mandatory health insurance in 2014, the DHA said that some 98% of Dubai residents had been covered. The authority also said it has made significant strides in efforts to improve efficiency by digitising hospital records. The DHA said electronic medical record systems had been implemented across all DHA hospitals and health centres, and that trials of other technologies, such as 3D printing, artificial intelligence and blockchain, had shown meaningful results.

Mental Health

Progress has also been made in the area of mental health, with the launch in April 2018 of the DHA’s first comprehensive mental health strategy for both public and private health care providers, titled Happy Lives, Healthy Communities. The plan coordinates governance, legislation, awareness, prevention and early detection programmes, patient empowerment and service delivery in a single approach. A total of 10 programmes have been outlined for implementation under the plan by 2021, including the reorganisation of mental health services across the emirate; education and training of medical staff, and professional development of mental health professionals; and support programmes for sufferers of post-traumatic disorder.

Public Spending

Infrastructure and social development, including health and education, are expected to be key beneficiaries of Dubai’s 2019 budget, which was approved on January 1, 2019. Following a record 19.5% increase in expenditure under the 2018 budget to Dh56.6bn, ($15.4bn) outlays will be maintained at roughly the same level – Dh56.8bn ($15.5bn) – in 2019. This is in line with the UAE’s overall public expenditure strategy, with the Cabinet approving the largest federal budget in the country’s history in September 2018.

According to the budget statement, spending allocations for priority sectors will largely be the same as the previous year. A large amount – Dh9.2bn ($2.5bn) – will go towards infrastructure development ahead of Expo 2020, while 33% will be spent on health, education, housing and community development.

Health Indicators

As a result of careful policy planning and investment, Dubai and the UAE as a whole have made good progress on major health indicators in recent decades. Life expectancy in the UAE increased from 62.5 years in 1971 to 77.3 years in 2016, while the infant mortality rate per 1000 live births declined from 65.2 to 7.7, according to World Bank data. There has also been a significant increase in medical professionals over the past decade. According to the latest available DHA data, the number of registered physicians in Dubai increased by 82.4% between 2010 and 2017 to 8693, while the number of nurses rose by 92% to 17,858. Despite this, the sector did not see a significant increase in the ratio of physicians to the population. There were 2.9 doctors per 1000 people in 2011 and in 2017 – down from 3.4 in 2016 – while the number of nurses declined from 7.2 in 2016 to 6 in 2017.

Broken down by sector, there were 2.6 private physicians per 1000 people in Dubai in 2017. The number of registered DHA physicians and nurses increased by 1.1% in that year to 6001 so that at DHA hospitals there were 0.8 physicians per bed and 2.7 nurses. Rashid Hospital employed 34% of total DHA physicians; Dubai Hospital 27%; Latifa Hospital 11.7%; and Hatta Hospital 7.2%. A total of 18.9% and 1.3% of DHA physicians worked in PHCs and specialised health centres, respectively.

NCD Challenge

Meanwhile, health care officials in Dubai and across the UAE have been taking measures to halt the rise of non-communicable diseases (NCDs). These are estimated to account for some 77% of all deaths in the UAE, according to the World Health Organisation (WHO), with one NCD – cardiovascular disease (CVD) – accounting for over two-thirds of all fatalities. Cancer, diabetes and traffic accidents are the other main causes of death, nationwide, according to a study published by the Institute for Health Metrics and Evaluation, an independent global health research centre at the University of Washington. Obesity, which is a risk factor for Type 2 diabetes, affects 19% of Emirati adults aged between 20 and 79.

In Dubai, CVD and circulatory system diseases were the leading causes of death in 2017, accounting for some 30.4% of all hospital deaths occurring that year in the emirate. The trend is continuing in younger generations, too, with the number UAE schoolchildren who are overweight and obese about twice the global norm. One in three school-aged children are obese or overweight, according to the WHO.

A major part of the emirate’s health strategy is therefore aimed at the prevention of NCDs, as it is in the country as a whole. UAE Vision 2021 sets key performance indicators for decreasing the number of deaths from NCDs; tackling the prevalence of diabetes and obesity among children; and reducing the number of smokers.

Additionally, in October 2017 the federal government raised taxes on cigarettes and energy drinks by 100%, and sugar-sweetened beverages by 50%. Other measures are also under discussion, including regulations on fast food, such as front-of-pack labelling for pre-packaged products and a 20% reduction in sugar content in some foods; and introducing healthier food and more physical activity in schools. Revenues raised from the tobacco and beverage taxes will go towards strengthening the country’s second approach to NCD care: detecting those at risk.

New Facilities

To meet the goals of its health strategy a number of major expansion projects at DHA hospitals are under way or in the pipeline. These include a two-phase plan for Dubai Hospital, with works to include a six-floor extension for specialised outpatient clinics, and lecture halls and workshops. Latifa Hospital is also set to double capacity to 60,000 patients by March 2020. The hospital is building a new delivery suite, set to open in September 2019, and is expanding its emergency services.

Meanwhile, a new skin bank for burn victims is under construction as part of a two-year expansion at Rashid Hospital. The unit, which is expected to open in 2019, will be followed by a new cancer treatment centre and expanded cardiology unit in 2020, according to media reports.

A new oncology hospital and research centre is also scheduled to open in the emirate in 2020. The facility will have a 700-patient capacity in its first phase, scaling up to 4000 by 2027. It will focus on treating cancers of the breast, colon, lung and prostate, and creating a cancer patient database.

The private sector, too, has undergone expansion in recent years. In 2017 the DHA announced that some 12 new private hospitals were scheduled to open in the emirate by 2020. Large numbers of smaller facilities have also entered the market. In September 2018, for example, the UK’s King’s College Hospital (KCH) opened its first facility in Dubai Marina and has plans for a second, 100-bed facility in Dubai Hills, which will be linked directly with KCH’s specialist services in London.

Medical Tourism

One area in which the private sector is expected to excel is medical tourism (see Tourism chapter), with the DHA targeting 500,000 health tourists by 2020. Dubai is already a player in this market, being ranked 16th globally in the International Healthcare Research Centre’s 2016-17 Medical Tourism Index. In 2016, the most recent year for which statistics are available, the sector generated some $381m from 326,649 visitors – 9.5% more than in 2015, according to the Dubai Health Tourism Council, which was set up by the government in 2014 to develop health tourism in the emirate.

High-potential Segment

Cosmetic surgery is one area in which Dubai is a global leader. The emirate has the highest concentration of plastic surgeons in one city anywhere worldwide, at 47 per 1m inhabitants. It had 236 licensed cosmetic surgeons as of 2018 and 386 licensed dermatologists. The high concentration has led to strong competition and low prices, which has made maintaining standards a challenge. “Building a high-quality reputation is the most important factor to take into account when developing a strategy to boost medical tourism,” David Hadley, CEO of private health provider Mediclinic Middle East, told OBG. “It is a long-term strategy that would bring the best results in the future.”

In recognition of the importance of maintaining development and standards within this key industry, Dubai Health Strategy 2016-21 includes a specific programme aimed at the following: improving soft and hard infrastructure; promoting harmonisation and updating and revising regulations; and enhancing the sector ecosystem to facilitate more medical tourism in the emirate. Making sure that standards in areas such as cosmetic surgery align with international best practices is also a focus. An online service – Dubai Health Experience – has been set up to support the DHA’s efforts to strengthen the emirate’s position on the global medical tourism map. It acts as a one-stop shop for potential medical tourists to research and book health care treatments in Dubai.

Insurance

Emirati nationals are insured by a government-sponsored medical insurance scheme set out by the DHA. Nationals who are employed in the private sector may choose between the national scheme or a policy provided by their employer.

The Health Insurance Law of 2013 made health insurance mandatory for all Dubai residents. The law stipulated that all those officially living in the emirate have a level of health insurance that meets or exceeds the benefits levels required by the DHA. After it came into effect in January 2014 the law was rolled out in three phases according to company size. Following completion of the final phase in March 2017, all residents, companies, employee dependants, and domestic workers are required to have insurance, at least at the minimum level.

Dubai employers are legally obligated to provide employees with medical cover without deducting premiums or reducing salaries. All dependants and domestic workers must also have basic health insurance, known as the Essential Benefits Plan, but employers are not obligated to provide insurance for their employees’ dependants. Employers and sponsors failing to comply with the regulations may be fined by the DHA and their visas may be refused or not renewed. Dubai citizens without other cover can access health insurance via the Saada programme, which provides health care treatment through a network of private providers and DHA health care centres. In addition, all Dubai government employees and their dependants receive comprehensive medical cover under the Enaya health insurance scheme, a strategic partnership between the DHA and Neuron, a third-party administrator.

Another DHA initiative – the Insurance System for Advancing Healthcare in Dubai (ISAHD) – aims to provide high-quality health care for Dubai nationals, residents and visitors. In addition to providing coverage, ISAHD’s goal is to monitor and introduce enhancements to the health care system.

Since 2014 the DHA has maintained a selection of participatory insurers (PIs), companies that are not allowed to refuse coverage to anyone who applies and that can charge a premium of Dh600-700 ($ 163-191). PI coverage is intended for employees and individuals whose salary falls below Dh4000 ($1090). In 2017 the PIs included: AXA Insurance, Ras Al Khaimah National Insurance Company, Daman, Oman Insurance Company, Orient Insurance Company, MetLife, Takaful Emarat Insurance, National General Insurance, Abu Dhabi National Insurance Company, Union Insurance and Noor Takaful. Dubai residents are also able to file online complaints regarding health insurance services and/or providers in the emirate through the DHA’s iPROMeS system. All together approximately 100% of Dubai’s citizens have health insurance coverage, with around 60% of expenditure covered by private insurance, according to the DHA.

Pharmaceuticals

The UAE as a whole is the second-largest pharmaceuticals market in the GCC. MoHP figures suggest that sales across the emirates are likely to rise from Dh9.61bn ($2.6bn) in 2016 to Dh14.1bn ($3.8bn) in 2021, meaning that pharmaceuticals’ share of total health care expenditure will rise from 16.2% to 18% over the same period.

Approximately 90% of all pharmaceuticals products are also imported. Inbound shipments are expected to increase in value by a compound annual growth rate (CAGR) of 5.1% between 2016 and 2020. The main countries of origin are the UK, Switzerland, Germany, Belgium, the US, France, Spain, Italy and Australia. Pharmaceuticals companies Pfizer, Novartis, Sanofi, GlaxoSmithKline, Bayer, AstraZeneca, Merck, AbbVie, Eli Lilly, Bristol-Myers Squibb and Amgen are all present in the market, operating either within the emirates or via domestic contract manufacturing or distribution channels.

The UAE also exports pharmaceuticals, with sales expected to rise from $950m to $1.13bn in the 2016-20 period. Prominent local manufacturing players include Gulf Pharmaceutical Industries, Neopharma, Global Pharma and specialty generic injectable maker Gulf Inject. The cost of pharmaceuticals is regulated by the federal government, which began reducing prices in a phased manner in 2011, so that by the end of 2017 prices of some 8732 products had been cut.

Dubai is a leading location within the UAE for the pharmaceuticals industry. DHCC has become a base for many international companies, such as AstraZenca, Novartis, Abbott, Allergan Middle East, and Merck Sharp and Dohme, while the Dubai Science Park, another free zone, is also a centre for research and development: Bayer, Bristol-Myers Squibb, Medtronic and Pfizer are all located there.

JAFZ

Jebel Ali Free Zone (JAFZ) is also a base for pharmaceuticals companies, with 2017 seeing a special agreement signed between the industrial zone’s authority and the UAE government to promote the sector and develop local manufacturing of pharmaceutical products. The agreement aims to attract 75 innovative drug makers to JAFZ by 2021, with the number of companies producing patented drugs locally expected to double.

The emirate is also aiming to bring an additional $2.5bn in investments to the pharmaceutical industry between 2017 and 2021, under its new 2030 industrial strategy. This programme targets six industries, with pharmaceuticals and medical equipment being two of them, seeing as the UAE imports most of its medical equipment. The most in-demand items are in orthopaedics and prosthetics; patient aids; dental products; and consumables, such as bandages, dressings and needles. Each of these four categories is expected to display a CAGR of more than 6% from 2016 to 2021, according to the Dubai Export Development Corporation.

Dubai also re-exports medical equipment and devices, mainly to other markets within the Middle East, with Saudi Arabia the top destination. Popular devices include diagnostic imaging equipment and cardiovascular devices. The latter is of growing significance because of the increasing prevalence of CVD, with intervention cardiology and cardiac rhythm management two substantial areas of demand.

Outlook 

With a growing population and targeted government policies aimed at the development of segments such as medical tourism, domestic pharmaceuticals and medical equipment, Dubai’s health care sector is set to see strong expansion in the years ahead. An ageing population, almost universal health insurance coverage and increasing expectations of high service levels will also add to the demand for sector investment, innovation and quality. At the same time, the DHA’s stated objective of shifting much of the financial responsibility for the sector from the public to the private sphere presents major opportunities for international and local investors.

Some challenges, of course, remain, including recruiting enough health professionals to fulfil demand. Recent years have seen a number of developments on this front, including easier online job application processes. Additionally, workforce development is likely to create opportunities for health care training and education specialists.