Kuwaiti government gives health care a sustainable future

Health care needs in Kuwait are evolving rapidly in line with its changing economic and population profile. The government is looking to target resources more appropriately, and the private sector looks set to take on a greater role in health care provision.

Demographics

One of the principal factors shaping Kuwait’s changing health policy is the demographic makeup of its population. While its birth rate has remained relatively high, the country’s mortality rate has dropped significantly in the last two generations. The result of this demographic shift is that 25% of the population are currently under 15, according to World Bank figures. Nonetheless, the birth rate is also dropping: the total fertility rate has fallen from 4.8 children born per woman in 1983 to 2.6 children born per woman in 2013.

As birth rates fall, the average population age of the country is set to increase. With its aging population, Kuwait follows the general pattern of the GCC as a whole, where the proportion of over-65s is due to increase from 2% in 2015 to 20% by 2050, according to figures from Alpen Capital. In general, the population continues to rise through both natural growth and immigration, as Kuwait’s prosperous economy continues to draw in expatriate workers.

Health Expenditure

Kuwait’s prosperous economy is also altering the nature of health care in the country. As countries become wealthier, communicable diseases tend to be replaced by non-communicable ones, and Kuwait is no exception to this trend. Moreover, while the state’s medical system has expanded hugely over the past fifty years, many Kuwaitis continue to seek treatment abroad, especially for less common conditions.

The result is that the cost of providing health care is set to rise substantially in the coming years. According to a report from Alpen Capital, between 2013 and 2018 the health care market in the GCC is set to rise in value from $39.4bn to $69.4bn, representing a compound annual growth rate (CAGR) of 12%. Alpen forecasts the health care market in Kuwait to grow at the slightly lower CAGR of 9.4% between 2013 and 2018, increasing the total value of the market from $3.5bn to $5.4bn. In 2018, the outpatient market is forecast to be worth some $3.9bn, or 72%, while the size of the inpatient market is forecast to be worth $1.5bn, or 28%.

Kuwait spends significantly more on health care per capita than the regional average: $1507 in 2013 compared to $1279 in the GCC as a whole, according to the World Bank. Total health spending as a proportion of GDP is slowly rising, from 2.2% in 2006 to 2.9% in 2013, according to the World Bank. In 2012, the number of hospital beds per capita rose from 20 beds per 10,000 head of population to 22 beds per 10,000 head of population. However, in nominal terms, health spending more than doubled over the period, from $2.28bn in 2006 to $5.08bn in 2013. Government health expenditure makes up the vast majority of this figure, accounting for over 82% of the total health spend in 2013.

However, while Kuwait enjoys ample financial resources, hydrocarbons continue to account for most of the GDP (58.5% in 2013, according to IMF figures), meaning that international price fluctuations can have a big effect on the state budget. In view of all this, the government in recent years has started to implement a series of reforms aimed at placing health care funding on a more sustainable footing by putting an emphasis on tackling lifestyle-related diseases and expanding the scope of the country’s health care infrastructure.

Regulation

Currently, the Ministry of Health (MoH) retains ultimate responsibility for the various aspects of the health care system in Kuwait: public health, preventative health, operating public medical facilities directly and regulating the private sector, among other functions. A public health system has developed progressively since the 1930s, functioning as a government service operated by the MoH and free at the point of use. In addition to this, a number of other public or semi-public institutions, such as the military and the Kuwait National Petroleum Company, operate their own autonomous health care systems for their employees.

Moreover, it is not uncommon in Kuwait for employers to pay for private health insurance for their staff. As private provision comes to form an increasingly large proportion of overall provision, the government is studying the possibility of setting up an independent health care regulator, to undertake policy licensing and quality assurance functions. This would also have the advantage of resolving the current fragmentation whereby the responsibility for building and operating health care services is divided across several public bodies, including the MoH, the Ministry of Defence and the Amiri Diwan. At the time of writing, no decision on this had been taken.

Infrastructure

One area where Kuwait has sought to increase capacity is in health care infrastructure. A rising population in absolute terms means a greater need for hospitals, polyclinics and other medical centres. In light of this, Kuwait has been investing in new facilities, with the result that its ratio of hospital beds per capita has been growing steadily in recent years. According to World Bank figures, the ratio grew from 1.9 per 1000 inhabitants in 2006 to 2.2 per 1000 inhabitants in 2012.

A number of public bodies are investing in capacity, expanding existing hospitals or building new ones, and adding new clinics and specialist centres. The government plans to increase the total number of beds by around 11,000, with the MoH upgrading eight hospitals, and a number of other departments also investing in new capacity. The MoH investment programme is worth roughly KD1.25bn ($4.31bn).

Private Sector

As a country’s wealth increases and basic needs are met, the population increasingly tends to make use of private provision of services, either in order to escape queues or because the levels of facilities and services on offer in the private sector are perceived as being of better quality. Kuwait is no exception to this trend, and while the government continues to be the main provider of health care, the country is also home to several private hospitals and health care groups. In contrast to public hospitals, these will often offer private accommodation, suites, wellness services and minimal waiting times. Some of the most prominent are Dar Al Shifa, Al Salam International Hospital, New Mowasat Hospital and Royale Hayat Hospital.

Of these, Dar Al Shifa is the oldest, founded in 1963. It began as a private maternity hospital and has since added services such as paediatric care, plastic surgery, dermatology and cardiology. It moved to a new site in Hawally in 2003. Al Salam International Hospital, founded in 1964, has 185 beds, offers obstetrics, paediatric services and vascular surgery, and complies with Accreditation Canada standards. Located in Kuwait City, it is majority owned by Kuwait Finance House, a local banking group. New Mowasat, which opened in 1965, has 100 beds and also holds Accreditation Canada status. Services available include obstetrics, rheumatology, orthopaedics and wellness services. Owned by Mowasat Holding Company, which trades on the local bourse, it is itself a subsidiary of Kuwaiti group Nafais Holding Company. Perhaps the most luxurious of the private hospitals is Royale Hayat Hospital. Founded in 2006, the hospital focuses on women’s and children’s services. It has a partnership agreement with Banyan Tree Hotels and Resorts, a global hospitality and wellness chain, in order to maintain a high standard of service in its accommodation.

Privatisation

The Kuwaiti government has recognised the expertise that the private sector can bring to health care and is looking to expand private involvement in the system, initially for the large numbers of expatriates in Kuwait, who number 2.8m or just under 69% of the total population, according to 2014 figures from the Central Statistical Bureau (CSB). Until 1994, the government met the expense of treating foreigners in Kuwait. In that year, the MoH introduced an annual fee of KD50 ($173) for expatriates to use the public system, along with a series of nominal charges for appointments. Since 2013, the MoH has experimented in offering different time slots for non-emergency treatment of Kuwaiti nationals and foreigners, with certain facilities setting aside the mornings for the former.

The authorities are looking to the private sector to assume responsibility for non-emergency care of expatriates working in Kuwait and their dependents. The Kuwait Health Assurance Company (KHAC) is due to commence operations in 2015. A 24% stake is held by the Kuwaiti government, through the Kuwait Investment Authority (19%) and the Public Institution for Social Security (5%); a further 26% is held by Arabi Holding Group, as a strategic investor; with the remaining 50% to be offered to the Kuwaiti public through an IPO on the Kuwait Stock Exchange.

In December 2014 the company’s paid-up capital amounted to KD230m ($792.4m). On the 31st of December 2014 the government, through the Kuwait Clearing Company, distributed 50% of this capital in 1.15m shares to every Kuwaiti national, meeting all subscription fees. KHAC will construct three hospitals and 12 primary care centres to deal with the care of expatriates in Kuwait. The government will provide KHAC with land for these facilities, with 20-year leases available on favourable terms.

Expatriates will be obliged to take out insurance with KHAC to meet the costs of their treatment, and will be obliged to use KHAC facilities as their first port of call for non-urgent treatment needs (although MoH facilities will continue to accept expat accident and emergency cases and to treat them for free). However, the KHAC project has not been without its critics. In July 2014, a committee of the Supreme Council for Planning and Development warned that the existing model for privatisation of the care of expatriates was likely to result in KHAC’s eventual bankruptcy, requiring a state bailout, and called instead for more competition between different health insurance companies.

Non-Communicable Diseases

Part of the advantage of greater private sector involvement in the health care system is that it frees up resources to tackle non-communicable diseases. As countries grow richer, measures such as immunisation programmes, better sanitation and widespread and affordable primary health care lead to the near eradication of most communicable diseases (such as measles, tuberculosis and cholera).

At the same time, this greater prosperity leads to changes in lifestyle, as people move away from physical, outdoor work towards more indoor, sedentary work. Cars tend to replace walking as the primary means of transport, and people adopt different dietary habits, often consuming more meat, sugar and saturated fat, at the expense of grains, pulses and green leafy vegetables. As such, richer countries tend to face health challenges in the form of noncommunicable diseases, such as diabetes, cancer and heart disease, which often have their root causes in a person’s lifestyle and diet.

Kuwait is no exception to this trend, and the country registers some of the highest rates of non-communicable diseases in the world. According to WHO statistics, in 2014 non-communicable diseases accounted for 73% of all deaths in Kuwait, followed by communicable diseases (16%) and injuries (11%). Cardiovascular diseases, cancer and diabetes were the leading non-communicable diseases. WHO figures indicate that in 2008, some 37.2% of adult males and 52.4% of adult females suffered from obesity, while the incidence of high blood pressure was 29% for adult males and 23.7% for adult females, and the incidence of high blood sugar was 17% for adult males and 14.8% for adult females.

According to the Dasman Diabetes Institute, a leading centre for the treatment of the disease in Kuwait, the prevalence of diabetes in the country is currently running in the region of 23%. The majority of the cases of diabetes diagnosed in Kuwait are type 2 diabetes: that is, diabetes which shows a strong correlation with risk factors such as obesity, poor diet and lack of physical activity. Rates for type 1 diabetes, which is largely the result of a genetic predisposition, run at around the world average.

Much of the rise in such illnesses is down to the sort of lifestyle changes mentioned above; in Kuwait, eating out is common, most households will have at least one car and many people avoid strenuous activity during the hot summer months, when temperatures regularly exceed 40°C. However, there is also some evidence of a genetic predisposition to certain lifestyle diseases among segments of the population. For example, the incidence of diabetes is highest among expatriates of South Asian origin, even though this group tends to be younger than the population average in Kuwait and is more likely to work in physically demanding jobs.

Successfully promoting a healthier way of living as lifestyles change can be much harder to realise than tackling communicable diseases. To date, while the MoH in Kuwait has a number of programmes to deal with non-communicable diseases, the country lacks a holistic strategy to promote public health through improved nutrition and physical activity. However, there are a number of smaller-scale initiatives, and there are suggestions that the mooted reorganisation of the MoH could result in a specialised unit for tackling non-communicable diseases.

Research

Up to now, limited medical research has taken place in Kuwait due to the relatively recent development of both the health care and education systems. However, the rise in non-communicable diseases is leading to a greater emphasis on research in specialised branches of medicine, as well as the public dissemination of information on how to treat and prevent specific diseases.

For instance, the Kuwait Cancer Control Centre provides nutritional advice as well as medical treatment, while the Dasman Diabetes Institute, a subsidiary of the Kuwait Foundation for the Advancement of the Sciences, runs cooperation programmes with a number of universities and clinical research institutes overseas. The institute has several research projects ongoing, ranging from an investigation of the cellular and molecular anti-inflammatory response in obese individuals to a population study on national wellbeing, as well as a genetic and molecular investigation into Kuwaiti hereditary disorders.

It also runs group education programmes for diabetes sufferers, schoolchildren and community role models such as teachers. The idea behind these programmes is to focus on diet and activity levels, and to spread awareness of the importance of a healthy lifestyle in avoiding non-communicable diseases such as diabetes. The institute is recognised as a centre of excellence for the Gulf region, and recently signed a memorandum of understanding with the Kuwaiti National Guard (who run their own medical care system) to incorporate the Dasman approach to tackling diabetes into their health care.

Personnel

Kuwait counted 2.7 physicians per 1000 heads of population in 2012, according to the latest figures available from the World Bank. In 2012, Kuwait had a total of 47,380 medical staff, of which 21,853 were Kuwaiti, or roughly 46% of the total. To make up the shortfall, Kuwait hires medical staff from abroad, chiefly from other Arab countries, but also from Asian nations such as India, Pakistan and the Philippines. Kuwait has one medical school, the College of Medicine at Kuwait University, which in the academic year 2012/13 had 184 students studying medicine (of which 160 were Kuwaiti nationals), according to the latest available figures from the CSB. However, a number of Kuwaitis also study medicine abroad (particularly in the UK and the US) meaning that the total number of Kuwaiti nationals studying medicine is likely to be significantly higher. The MoH runs its own internal training schemes through the Kuwait Institute for Medical Specialisation.

In addition to this, the Kuwait Life Sciences Company provides medical training and certification in Kuwait and beyond through its Life Sciences Academy (LSA). The LSA, which is run as a non-profit body, offers workshops, short courses and distance learning for personnel such as physicians, dentists, nurses and pharmacists, in association with a number of Western universities and research centres.

Pharmaceuticals

There is currently little local production of pharmaceuticals in Kuwait, although limited production of basic generic medicines such as painkillers and certain antibiotics does take place. The general public exhibits a strong preference for name brand medicines over generics, but the health authorities are attempting to steer patients towards greater use of generic medicines, to reduce costs. GCC countries are in the process of standardising their licensing and registration systems for medicines, which should help realise further cost reductions. Over the medium term, the GCC is also looking to introduce collective purchasing of pharmaceuticals, to help deliver economies of scale across the region.

Outlook

While the government appears likely to remain the principal provider of health care for the foreseeable future, the role of the private sector is set to increase significantly, especially for expatriates, as KHAC commences operations. Public health policy has started to place a greater emphasis on preventative health and non-communicable diseases, although this may take some years to bear fruit. Over the nearer term, expansion of public health services is set to increase the system’s capacity and reduce the need for patients to seek treatment overseas, strengthening Kuwait’s health system generally, to the benefit of both the private and public sectors.

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The Report: Kuwait 2015

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