26 - 29 JANUARY 2022

HALL C, KUWAIT INTERNATIONAL FAIR, KUWAIT

ATEX International Exhibitions is an international exhibitions & events company that has evolved into one of the leading organisers of exhibitions, conferences and events in the Middle East & North Africa. We​ organise both business and educational platforms attended by thousands of participants every year to do business, network and learn.

For more information, visit www.atexinternational.com

​Kuwait 2020 Health Infrastructure Report

Updated: Nov 21, 2021

Dr. Mussaad M. Al-Razouki, Chief Business Development Officer, Kuwait Life Sciences Company


Amidst the backdrop of low oil prices and a ballooning government budget, Kuwait continues to experience growth of the healthcare sector, in large part due to the public sector’s corybantic building initiatives to develop infrastructure. This growth is also despite poor World Bank and World Economic Forum ratings in key indicators, such as regulatory quality and government policy transparency. Indeed, we anticipate that once the growth of the healthcare sector stagnates, it will be in part due to these bottlenecks. The country must institute regulatory control for each sector, especially healthcare due to the large share of government budget it receives (11%). This will stimulate the development of new public-private initiatives such as those seen early on with Dhaman and Afya health insurance.

Kuwait has drastically increased the number of healthcare professionals and ramped up its health sector capital expenditure since its independence, but this growth has languished in the last twenty years. Indeed, in the ten years of preparing this report, the Kuwaiti healthcare sector has not improved significantly in terms of quality and access. The burden of disease in Kuwait remains startlingly high, with some of the highest rates of obesity and diabetes in the world. This will have ripple effects on the country’s medical infrastructure which, given the New Kuwait Vision 2035, is only now starting to meet the population demand in stride.

The public sector has greatly increased the number of beds available to the population by simultaneously building new hospitals and expanding existing ones to double or more their current capacity. The Ministry of Health (MoH) has been the major driver of this, but there are other government institutions such as the Public Authority for Social Security that are establishing their own medical cities. Of note is the challenge of hospital management; the Ministry of Public Works built and MoH operated (partly) Jaber Hospital has capacity for 1168 beds yet is only operating at just around 25 to 50%. This illustrates the need for simultaneous oversight of hospital functions, especially the need to ramp up human capital and operational expenditures in addition to the expansion processes.

The slow-paced growth of the burgeoning private healthcare sector is driven by new medical centers, each looking to cement their own cosmetic or outpatient niche. Medical centers are in line with patient desires and a few even present quality and accreditation not seen in the public sector. Medical centers also present an attractive business opportunity, with KLSC estimating a 30–40% operating income margin for the average successful medical center. With this new growth comes a shortage of physicians, surgeons, and allied health staff.

The future of healthcare in Kuwait rests on the integration of digital systems in existing and new infrastructure. Private patient health records represent a sorely needed technological innovation in Kuwait, as antiquated paper filing systems are still in effect. In addition, hybrid healthcare systems would aid in curbing government spending. Hybrid healthcare systems enable patients to seek health care but pay a premium for faster, better service. If Kuwait is to realize the 2035 New Kuwait Vision, hybrid healthcare and digitized systems must become the new normal.

I. Economic Landscape of Kuwait

The projected budget for the State of Kuwait for 2019/2020 is 22.5 bn KD ($74.9 bn), which represents a 4.7% increase from the previous year. The majority of the budget is attributed to salaries of constituent government employees (~54%). Kuwait also has projected 8.6% higher gross revenue from 2018/2019 at an estimated 16.4 bn KD ($53.9 bn), with the majority of gross revenues are derived from oil. For the fifth consecutive year since 2015, government expenditure will surpass revenue due in large part to oil prices and limited economic diversification.

There are certain alterations in legislation and government infrastructure that must change to enable diversified economic growth. Principal among these is clarifying government policies and improving regulatory quality, which the World Economic Forum (WEF) ranks Kuwait lowest in the Gulf Cooperation Council (GCC). Kuwait has seen a notable increase in regulatory bodies that have oversight of certain institutions (i.e. CITRA for communication and IT regulation), but there is a lack of concerted regulatory efforts in the healthcare sector, specifically between various public sector stakeholders, such as the Ministry of Health, Ministry of Defense, Kuwait Oil Company, and the Public Institute for Social Security and private health sector operators.

In addition, the WEF ranks Kuwait lowest in the GCC for transparency of government policymaking. This makes it exceedingly difficult for the private sector to grow, especially when considering foreign direct investment. Despite the above, Kuwait is experiencing a growing market in healthcare that is best conveyed by an 11% CAGR in the medical device market, an indication that public and private health centers are indeed on the rise.

In order to sustain this growth in the healthcare sector (which is largely driven by public initiatives) and to stimulate quality indicators, it is essential to increase the privatization of healthcare services. This is advised to not only raise the market share of private companies but to ease government burden. An example of such an initiative is Dhaman (also known as the Kuwait Health Assurance Company) which exists as a Public-Private Partnership (PPP) regulated by the Kuwait Authority for Partnership Projects (KAPP) and intends to provide primary health centers to expatriates in Kuwait. Dhaman opened their belated first healthcare center in Cairo Complex located in Hawally in November 2019, which is the first of fifteen (15) planned primary care centers. Whilst ex-pats in Kuwait pay 2–5KD for each government health center visit, Dhaman asks for a nominal 0.5 KD extra on top of these government fees. Dhaman is thus one example of a diversification strategy, at least with respect to healthcare.

The Private Health Insurance Initiative, known colloquially as Afya, is also a prime example of Kuwait’s movement towards increased privatization. The initiative aimed to provide insurance to retired Kuwaitis, usually over the age of 55, however, those citizens opting for early retirement may also qualify. The Gulf Insurance Group (GIG) secured the first tender advertised by the government in 2016 and began offering “Afya” health insurance cards to approximately 123,000 individuals. Members are entitled up to 17,000 KD per year of coverage, with the exclusion of cosmetic additions. As of July 2019, the second edition of the Afya health insurance, also won by GIG plan has expanded coverage to include removal of benign and malignant tumors/neoplasms, cardiac catheterization (including three stents per year), kidney stone removal, dental implants and crowns, and joint articulation with prosthetics. This is a highly strategic move, as Kuwait’s elderly population is gradually increasing in proportion along with this demographic’s burden of disease.

Kuwait spends around 4% of its GDP on healthcare, while other countries of similar population size and GDP spend far more. This may have to do with the size of the private market in Kuwait compared to more developed nations. Illustrating this is the fact that Kuwait’s primary driver of healthcare expenditure is the public sector, which accounts for 84% of the roughly 2.5 bn KD ($8.23 bn) spent per year.

The Ministry of Health in Kuwait is the primary healthcare stakeholder and sole regulator of the Kuwaiti healthcare system yet maintains an opaque end state vision of the healthcare system. This report recommends the separation of regulator, from provider and payor functions, with a strong dedication to improving quality and private sector participation as was done in the neighboring emirate of Abu Dhabi. Almost a decade ago, the 2011–12 Kuwait Government budget was the first time the Ministry of Health spent over 1 bn KD (3.3 bn USD) on the expenditure on the public healthcare system. Today, that same budget of the Ministry of Health is over 2 bn KD.

Furthermore, the percentage of healthcare spending by the MoH as a percentage of overall government expenditure has stayed relatively stable at around 7%, for this budget it is almost 11% of the total budget. However, these figures do not consider the amount spent by the other eight government-related entities such as the Ministries of Defense and Interior, and of the Kuwait Oil Company, that makeup between 10 to 20% of the healthcare sector in Kuwait.

Meanwhile, the private sector within Kuwait spends roughly 150 mn KD ($500 mn), which is dwarfed by the 188 mn KD ($620 mn) that the Ministry of Health alone has budgeted in 2018. Moreover, it is reported that 313 mn KD ($1.03 bn) to 1.37 bn KD ($4.5 bn) was spent by the government on sending Kuwaiti patients abroad for treatment in the last five years alone.

There are seven different government entities that send patients abroad for medical tourism in Kuwait. These include:

1. The Amiri Diwan

2. The Diwan of the Crown Prince

3. The Diwan of the Prime Minister

4. The Ministry of Health

5. The Kuwait Oil Company

6. The Ministry of Defense (including Army, National Guard, Air Force, Navy)

7. The Ministry of Interior (Police)

Similar to the unified overseas treatment processes present in Abu Dhabi and Qatar, Kuwait has a Department of Treatment Abroad present under the Ministry of Health. This office caters to Kuwaiti citizens only and patients are only eligible if the treatment sought is unavailable in Kuwait.