KSA | June 2022

HEALTHCARE MARKET
ASSESSMENT OF KSA

White Paper
Healthcare Market Assessment of Kingdom of Saudi Arabia
Healthcare Market Assessment of the KSA

CONTENTS
Section 1: Saudi Arabia General Market Overview 3
1.1 Population Indicators 3
1.2 Public Health Indicators 5
1.3 Resources and Indicators 6

Section 2: Healthcare Market Overview 10

2.1 Healthcare Infrastructure 10
2.2 Healthcare Service Utilisation 11
2.3 Medical Tourism Overview 12
2.4 Growth Drivers and Restraints 13

Section 3: Recent Trends in the Healthcare Market 14

3.1 Key Initiatives by the Government 14
3.2 Shift Towards Private Sector in Healthcare Delivery 21
3.3 Large, Planned Developments in the KSA Acting
as Key Drivers for Healthcare Investments 27
3.4 Market Shift Towards Specialised Formats 28

Section 4: Summary and Conclusion: Market Potential 31

1
Healthcare Market Assessment of the KSA

GLOSSARY
Abbreviation Details
ASR Age Standardised Rate
BMI Body Mass Index
BN Billion
CAGR Compound Annual Growth Rate
CMA Capital Markets Authority
CVD Cardiovascular disease
DBP Diastolic Blood Pressure
FY Financial Year
GCC Gulf Cooperation Council
GDP Gross Domestic Product
GOSI General Organisation for Social Insurance
IP Inpatient
IPO Initial Public Offering
IVF In vitro fertilisation
JV Joint Venture
KFSHI King Faisal Specialist Hospital International
KFSHRC King Faisal Specialist Hospital & Research Centre
KSA Kingdom of Saudi Arabia
MISA Ministry of Investment of Saudi Arabia
MN Million
MOH Ministry of Health
NA Not Applicable/Available
NCDs Non-Communicable Diseases
OP Outpatient
PPP Public Private Partnership
SAGIA Saudi Arabia General Investment Authority
SAR Saudi Riyal
SBP Systolic Blood Pressure
SME Subject Matter Expert
SMEH Scientific and Medical Equipment House
TASI Tadawul All Share Index
TBD To Be Decided
UAE United Arab Emirates
UK United Kingdom
US/USA United States of America
USD United States Dollar

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 Healthcare Market Assessment of the KSA

Section 1: KSA General Market Overview

The largest country in the GCC, the Kingdom of Saudi Arabia extends across the majority of the
Arabian Peninsula. On its west is the Red Sea and Islam’s holiest cities, Makkah, and Medinah. In the
country’s geographic heartland is a vast arid zone. On the east along the Arabian Gulf, are the
country’s rich oil fields. Its capital and largest city is Riyadh

1.1 Population Indicators

The most populous country in the GCC, KSA has a population that is expected to reach 36.8 million in
2022. While population grew at a CAGR of 2.5% over 2016-2022, CAGR over 2022-2032 is forecast to be
lower at 1.9%. KSA citizens constituted about 61% of the total population in 2020. As with several
countries globally, KSA is also expected to see a shift in the composition of its demographic in the
coming decade. With decreasing fertility rates and improving life expectancy, the proportion of 45+
year-olds are seen to increase. The 65+ year group is expected to grow the fastest at a CAGR of 6.9%,
followed by the 45-64 years age group at a CAGR of 3.7% during 2022-2032.

Exhibit 1: KSA Population, Age-wise split, Average Household Size (2022F, 2032F), Gender split (2020)1

Population (2022F, 2032F) Age-wise splt (2022F, 2032F)

CAGR
1.9% 2022F 2032F
44.4
36.8

22% 28%
4% 46%
51%
6%
23%
20%

2022F 2032F
Population (Mn) 0-14 15-44 45-64 65+ 0-14 15-44 45-64 65+

Gender split (2020) Average Household Size

58:42 2022F 2032F

Nale:Female 5-5 5-3

3
1
Population data source: Oxford Economics, 2021 Q4 update, General Authority for Statistics, JLL- Healthcare Analysis
 Healthcare Market Assessment of the KSA

In 1992, the Law of Provinces (Regions) was announced to improve provincial administrative standards
and development through local authorities. The law divided the Kingdom into 13 regions each of
which is headed by a prince from the royal family. From a healthcare delivery perspective, KSA is
divided into 20 geographically defined health clusters. A health cluster is an integrated and
interconnected network of healthcare providers under a single administrative structure that aims to
facilitate beneficiaries' access to health services and move them between several types of care.

Exhibit 2: Health cluster-wise split of population in KSA (2020)3

% SPLIT OF POPULATION
< 5%
QURAYYAT 1% NORTHEM 1%

5% - 10%
AL-JOUF 1%
10% - 15%

>= 25%
HAFR
TABOUK 3% AL-BATEN 4%

HA’LL 2%

EASTERN 10%
QASEEM 4%

MEDINAH 7%

RIYADH 25%
AL-AHSA 4%

MAKKAH 7% TA’IF 4%

JEDDAH 14% TAL-BAHAH 4%

QUNFUDAH 1% BISHAH 1%

NAJRAN 2%

Riyadh was the most populated cluster with about 8.9 million or a quarter of the country’s
population as of 2020. Jeddah and Eastern clusters had about 5.0 million and 3.5 million population,
respectively, in the same year. Together the three clusters accounted for about half of the country’s
population.

4
2
Ministry of Health KSA, General Authority for Statistics
3
Population data source: Oxford Economics, 2021 Q4 update, JLL- Healthcare Analysis
 Healthcare Market Assessment of the KSA

1.2 Public Health Indicators

A growing population, increasing ageing population, and a rise in chronic conditions will pressurise
the healthcare system of the country in the coming decade.

1.2.1 Leading causes of death

The top 10 causes of death in 2018 in the KSA are shown below.

Exhibit 3: Leading causes of death in KSA (2018)4

10%

9%
27%

6%

6%

5% 26%

4%
3%
3% 2%

Coronary Heart Disease Stroke Road Traffic Accidents Kidney Disease Influenza and Pneumonia

Alzheimer's & Dementia Diabetes Mellitus Liver Disease Congenital Anomalies Violence Others

Coronary heart disease and stroke contributed to over a third of the deaths in KSA in 2018.
Road traffic accidents were also observed to be particularly high in KSA, largely due to over speeding
and non-adherence to traffic rules. Road traffic accident fatality rates have been 17%-18% over
2018-2020. The Ministry of Health reported 199 post-amputation visits to medical rehabilitation
centres and departments of MOH, due to road traffic accidents in 2020. 15% of patients and
casualties that Saudi Red Crescent Authority Ambulances offered first aid to and transported in 2020,
were road accident patients. As part of the Vision 2030 of the KSA Government, one of the key
objectives under the Health Sector Transformation Programme, is enhancing traffic safety.

5
4
World life Expectancy
5
KSA MOH Report, 2020
 Healthcare Market Assessment of the KSA

• NCDs Profile
The leading causes of death, as seen above, are related to the high prevalence of NCDs in KSA. Compared
to its GCC counterparts, KSA was among the top three in Diabetes and Obesity prevalence. It must
be noted that although KSA may rank lower than other GCC countries in terms of
prevalence/incidence, as the Kingdom has the highest population in GCC, in terms of number of
cases, KSA would be the highest. Top three cancers in 2020 in males were of the colorectum,
non-Hodgkin lymphoma, and leukaemia. Similarly, in females, the highest observed cancers were of
the breast, thyroid, and colorectum. With a growing ageing population, the NCD burden of the
Kingdom is set to rise.

Exhibit 4: Age Standardised Prevalence of Non-Communicable Diseases6

Prevalence of Diabetes Prevalence of Obesity Prevalence of Hypertension Cancer incidence, 2020

among adults, 2019 among adults, BMI 30, among adults, 2019
2019

15.8% 27.5% 34.0% ~27K new cases

95.2 ASR*
2nd in GCC NA 6th in GCC 6th
6thin
inGCC
GCC

1.3 Resources & Indicators

1.3.1 Health Expenditure

Exhibit 5: KSA Total Estimated Healthcare Expenditure (USD Bn) and as % of GDP, (2016-2022F)7

42.0 6.4%
41.3
6.3%
41.0 6.3%
6.2%
39.8
40.0
6.1%
39.0 38.8 38.9
38.6 6.0%
38.0 37.9 5.9%
5.3%
37.0
37.0 5.8%
5.8%
6.7% 6.7% 6.7% 5.7% 5.7%
36.0
5.6%
35.0
5.5%
34.0 5.4%
2017 2017 2018 2019 2020F 2021F 2022F

Total Health Expenditure ( USD bn) Health Expenditure (% of GDP)

Note: Healthcare market size has been estimated based on total GDP of KSA and share of healthcare expenditure as % of
total GDP. The World Bank data for Healthcare expenditure as % of GDP is available till 2019 only. Post that, similar share of
GDP has been considered to arrive at total healthcare market size for KSA.

6
6
World Health Organisation, International Diabetes Federation, Statista, International Agency for Research on Cancer, JLL – Healthcare Analysis
7
World Bank (Feb 16, 2022 update), JLL – Healthcare Analysis
 Healthcare Market Assessment of the KSA

Among the GCC nations, KSA ranked first in terms of health expenditure as a percentage of GDP at 5.7% in
2019. For the fiscal year 2022, the KSA Government announced the allocation of SAR 138 Bn (USD 36.78 Bn)
for the Health and Social Development Sector. This was about 19% of the total government expenditure.
The KSA Government has been increasing the Health and Social Development Sector expenditure
year-on-year since 2017. The percent allocated for Health and Social Development has also been
increasing from 13% of total government expenditure in 2017, to reach 19% in 2021. Even though there is
growth in expenditure, there is still a gap in terms of spending compared to international benchmarks.
Developed countries like the US and UK spent about 19.7% and ~10% of GDP on healthcare in 2020. Efforts
of the KSA Government and private sector growth are expected to continue and drive growth of the
healthcare market going forward.
Domestic general government health expenditure amounted to 69% of the total healthcare expenditure in
KSA during 2019, indicating the significant role of government spending in domestic healthcare of the
country. Domestic private health expenditure constituted the remaining 31% of the total healthcare
expenditure in 2019.
KSA’s per capita spending on healthcare was approximately USD 1,316 in 2019, which was lower than UAE,
Qatar, Kuwait, and developed economies such as the US and UK.

Exhibit 6: KSA Current Healthcare Expenditure per Capita, Current USD (2019)8

KSA 1.316

UAE 1.843

Qatar 1.807

Oman 625

Kuwait 1.759

Bahrain 940

USA 10.921

UK 4.313

Current health expenditure per capita (current USD), 2019

1.3.2 Manpower per population

KSA had a physician density of about 2.7 per 1,000 population in 2020 and is among the top compared to
its GCC counterparts. However, nurse density per 1,000 population of KSA in 2020 was slightly lower
compared to that of Kuwait, Qatar, and UAE as per latest available indicators of 2019.

7
8
World Bank
 Healthcare Market Assessment of the KSA

Exhibit 7: KSA Density of Health Workforce per 1,000 Population (latest available)9

15.7

10.3
7.3 8
5.6 5.7 5.8
4.4
2.7 2.8 2.1 2.7 2.6 2.6

KSA (2020) Kuwait (2019) Oman (2019) Qatar (2019) UAE (2019) UK(2019) US 2018)

Physclans per 1.000 Population Nurses per 1.000 population

As part of the Saudiisation initiative of the government to increase participation of local talent in the
private sector, two new decisions were announced in 2021 regarding Saudiisation of jobs in certain
health specialities and in the medical appliances sector in all regions of the Kingdom. One of the
decisions was for localising jobs in medical laboratories, radiology, physiotherapy, and therapeutic
nutrition departments in all medical facilities operating in the Kingdom. The second decision applies
to Saudiisation in sales and advertising professions in the private medical equipment and appliances
sector. The decisions are to come into effect from April 11, 2022 and are expected to create 8,500 jobs
for KSA nationals.10 Physicians and nurses of KSA nationality constituted about 44% and 43%,
respectively, of the total of their professions in 2020.11

Exhibit 8: Saudiisation and employment requirements for select positions in Healthcare as identified
by Ministry of Human Resources and Social Development (MHRSD)12 Effective Date
Total Saudiisation
Sector Target of the Sector Details

• Applicable to all companies

with employees in: April 11, 2022
• Medical laboratories
• Radiology
• Physiotherapy
Healthcare 60%
• Therapeutic nutrition
• A minimum pay of SAR 7,000 will be
set for specialists and SAR 5,000 for
technicians, according to the
ministry’s statement

• Targets the professions of:

• Sales, advertising, and introduction of April 11, 2022
• Sales, advertising, and introduction of
medical devices: 40% in the first phase;
medical devices
80% in the second phase
• Engineering and technical professions in
Medical Devices
the medical appliances sector
and Equipment • Engineering and technical professions
• A minimum pay of SAR 7,000 will be set
in the medical appliances sector: 30%
for engineers, specialists, and bachelor’s
in the first phase; 50% in the second
degree holders, while SAR 5,000 will be
phase
fixed for technicians and diploma holders.

8
9
World Bank, Ministry of Health Reports, JLL Healthcare Analysis • 10 Saudi Gazette: Saudiisation of certain health specialties, medical equipment sector to create 8500 jobs
11
KSA MOH Report • 12 Argaam: HRSD minister issues Saudiisation decisions for health specialisation, medical devices professions
 Healthcare Market Assessment of the KSA

1.3.2.1 Manpower at Health Clusters

The KSA’s density per 1,000 population for physicians is 2.7 and nurses is 5.6. Among the health
clusters, Northern and Al-Jouf regions recorded the highest densities for physicians and nurses. While
major centres like Riyadh, Jeddah, and Makkah recorded below the national average.

Exhibit 9: Region-wise Manpower Density (2020)13

Riyadh 2.5 Riyadh 4.1

Makkah 2.4 Makkah 3.3
Jeddah 2.4 Jeddah 3.1
Ta' if 2.6 Ta' if 4.4
Medinah 2.6 Medinah 4.4
Qaseem 3.1 Qaseem 5.6
Eastern 2.9 Eastern 5.0
Al-Ahsa 2.2 Al-Ahsa 4.4
Hafr Al-Baten 2.8 Hafr Al-Baten 7.3
Aseer 2.6 Aseer 3.9
Bishah 2.9 Bishah 4.7
Tabouk 2.6 Tabouk 4.5
Hail 3.4 Hail 5.9
Northern 6.2 Northern 9.5
Jazan 2.0 Jazan 3.9
Najran 3.2 Najran 6
AI-Bahah 3.2 AI-Bahah 4.9
AI Jouf 4.1 AI Jouf 10.1
Qurayyat 3.4 Qurayyat 7.9
Qunfudah 2.5 Qunfudah 3.3

Physician Density per 1,000 population Nurse Density per 1,000 population

*excluding OGS manpower which constitutes about 19, of Physicians and 23, of Nurses

9
13
KSA MOH Reports, JLL – Healthcare Analysis
 Healthcare Market Assessment of the KSA

Section 2: Healthcare Market Overview

2.1 Healthcare Infrastructure

Health services in KSA are provided by three sectors – Ministry of Health, Other Governmental Sector, and
Private Sector. This report refers to both the MOH and Other Governmental Sector as the Public Sector. Over
the 2016-2020 period, the number of hospitals grew at a CAGR of 1.8%; private and public hospitals grew at
a CAGR of 2.4% and 1.5%, respectively.

Exhibit 10: KSA Healthcare Facilities snapshot (2020)14

504 78.569
33% 25%

67%
75%

Hospitals Hospital Beds

Public Private Public Private

The highest concentration of hospitals according to 2020 MOH data, is in Riyadh at about 22%. This
is followed by Jeddah at 11% and Eastern region at about 10%. While number of beds is higher in the
Eastern region compared to Jeddah.

Exhibit 11: Hospital Bed Density per 1,000 Population15

2.9
2.5
2.2
2.1

1.6
1.5
1.1

KSA(2020) Kuwait (2019 Oman (2019 Qatar (2019) UAE (2018) UK (2019) us (2017)

10
14
KSA MOH Report
15
Oxford Economics, 2021 Q4 update, MOH Reports, World Bank, JLL- Healthcare Analysis
 Healthcare Market Assessment of the KSA

Although KSA has a better hospital bed density compared to its GCC counterparts, it has remained at
about 2.2 beds per 1,000 population over 2016-2020. Compared to developed economies such as the
US and UK, KSA has a lower bed density.
Among the health clusters, Ha`il recorded the highest growth in the number of beds at a CAGR of about
13% during the same period and was among the highest in bed densities compared to other health
clusters. Qunfudah and Makkah health clusters were among the lowest in bed densities.

Exhibit 12: Region-wise Bed Density and Private vs. Public sector split in Beds (2020)16
2.2

Riyadh 2.3 Riyadh 30% 70%

Makkah 1.4 Makkah 15% 85%

Jeddah 1.8 Jeddah 43% 57%

Ta' if 2.9 Ta' if 13% 87%

Medinah 2.3 Medinah 21% 79%

Qaseem 2.2 Qaseem 10% 90%

Eastern 2.7 Eastern 43% 57%

Al-Ahsa 2.4 Al-Ahsa 22% 78%

Hafr Al-Baten 3.0 Hafr Al-Baten 11% 89%

Aseer 2.1 Aseer 29% 71%

Bishah 2.2 Bishah 0% 100%

Tabouk 2.7 Tabouk 3% 97%

Hail 2.8 Hail 8% 92%

Northern 3.7 Northern 0% 100%

Jazan 1.5 Jazan 10% 90%

Najran 3.0 Najran 13% 87%

AI-Bahah 2.8 AI-Bahah 9% 91%

AI Jouf 3.7 AI Jouf 0% 100%

Qurayyat 2.7 Qurayyat 0% 100%

Qunfudah 1.2 Qunfudah 0% 100%

Bed Density per 1,000 population (2020) KSA Average Private Public

2.2 Healthcare Service Utilisation

Rising and ageing population, increased life expectancy, rise in lifestyle related and non communicable
diseases leads to increased demand for healthcare services.

11
16
KSA MOH Reports, JLL – Healthcare Analysis
 Healthcare Market Assessment of the KSA

Exhibit 13: Outpatient Visits, Inpatient Admissions, OP-IP Conversion Rates,

Hospitalisation Rates (2016-2019/2020)17

Outpatient Visits OP-IP conversion

100%- 138.2 143.7 151.3 153.2

2.8% 2.8%
(in MN) 2.6%
2.5%
2.3% 2.2% 2.1%
2.4% 2.2%

63% 61% 61% 63%

2016 2017 2018 2019 2016 2017 2018 2019 2020

Public Private Public Private

Inpatient Admissions Hospital Rates

10.7% 10% 10.8% 10.6%
100%- 3.4 3.3 3.6 3.6 100%-
(in MN) (in MN)

64% 60% 55% 55% 6.8% 6.0% 5.9% 5.8%

2016 2017 2018 2019 2016 2017 2018 2019

Public Private Public Private

The number of outpatients grew at a CAGR of 3.5% over 2016-2019. Covid lockdowns and hesitancy to
visit hospitals amid an ongoing pandemic saw the public sector record a steep fall of ~31% in
outpatient visits in 2020. Private sector outpatient and inpatient numbers are not available for 2020.
Although KSA’s healthcare is mainly driven by the public sector, private sector outpatient and inpatient
growth outpaced that of the public sector. Inpatient admissions in the public sector declined at a
CAGR of 2.8% over 2016-2019. The OP-IP conversion has been higher in the private sector since 2017.

2.3 Medical Tourism Overview

• Inbound
Of 46 global destinations ranked within the 2020-2021 Medical Tourism Index, KSA ranked 39 for its
Medical Tourism Industry. Among cases within the country that were referred to governmental or
specialist hospitals, majority were to Riyadh and its clusters.
KSA provides free and integrated health services to pilgrims during Hajj and various seasons through a
network of hospitals and health centres that have been established for this purpose, in addition to
hospitals and centres operating throughout the year. The ‘Hajj Visiting Manpower Participation Service’
allows medical and technical staff in selected specialities to apply for participation as part of MOH’s
hajj visiting manpower.18

12
17
KSA MOH Reports, JLL - Healthcare Analysis
18
gov.sa Unified National Platform
 Healthcare Market Assessment of the KSA

• Outbound
When some of the more advanced medical procedures are not offered or are not available at the best
quality in KSA, the country sends its citizens abroad for treatment. According to MOH, 488 patients
were sent abroad for specialised treatments in 2020. The top destination for KSA patients in 2020 was
US, followed by Germany and UK. The top speciality for treatment abroad was for tumours and cancer
treatments, contributing to about 62% of the total cases. This was followed by general surgery, internal
medicine, cardiology, and cardiac surgery. These figures are indicative of specialisation gaps that
need to be filled in the local healthcare market.

2.4 Growth Drivers and Restraints

The main drivers and restraints that affect private investment in the healthcare sector
in KSA are as follows:

DRIVERS CHALLENGES

• Growing population and increasing ageing demographic

of KSA calls for investment in healthcare specially related • The expenditure on healthcare is still majorly borne
to the older demographic such as Long-term care, geriatric, by the government
neurosciences, orthopaedics.

• High prevalence of chronic, non-communicable and lifestyle

diseases leading to more need for healthcare services in • Limited healthcare insurance coverage.
specialities like Cardiac, Oncology, Orthopaedics, OBGYN,
Endocrinology etc.

• Increasing insurance penetration is leading to increased

service utilisation and requirement of healthcare • Comparatively lower availability of skilled healthcare
infrastructure in the country. manpower

• The rise in affluent, health-conscious younger generation

is driving demand for high quality, specialised care. • Few specialized institutes dealing with medical research,
leading to low entrepreneurial activity around research.

• The KSA Government seeks to reduce its dependence on oil

resources by boosting non-oil sectors. The government
allocated a budget of SAR 138 Bn for Health and Social
Development in FY2022.19 Moreover, its move towards
privatisation and more favourable investment environment is
a major driver for growth of healthcare sector.

13
19
gov.sa Unified National Platform
Healthcare Market Assessment of the KSA

Section 3: Recent Trends in the Healthcare Market

3.1 Key initiatives by the Government

With the growing demand for comprehensive healthcare services in the Kingdom, the Government
has mandated a transformation of the country’s healthcare sector. The mandate aims to address
multiple existing issues in pre transformation offerings. Dealing with growing demand for healthcare,
inadequate supply in identified areas such as primary care and extended care, significant quality
gap in services given to patients, unwarranted variation in provision, access, and investment in
serving the population, and lack of patient centricity in existing models of healthcare in the Kingdom,
are some issues that the mandate focuses to resolve

3.1.1 Vision 2030 - Focus on Healthcare

To address these issues and elevate healthcare delivery in the Kingdom, the government announced
Saudi Vision 2030, a comprehensive plan that aims to reform the economic structure of the Kingdom
by developing other industries and sectors (including healthcare), ensuring that the economy
reduces its dependence on the finite oil reserves in the Kingdom.
The vision also aims at decreasing public expenditure, emphasises on increasing private sector
participation in various fields, which reduces the overall financial burden of the government.

During the first five years after the Vision’s launch, multiple Vision Realisation Programmes (VRPs) were
designed to best achieve the vision through approved objectives, plans, and key performance
indicators. While there are multiple VRPs, the three that apply to healthcare are outlined below:

14
Healthcare Market Assessment of the KSA

Exhibit 14: Healthcare Related Vision Realisation Programmes:

Health Sector Transformation

National Transformation Programme Privatization Programme
Programme

• Aims to develop infrastructure that • Aims to improve the quality of • Programme aimed at transforming
enables all entities achieve the services provided by involving the healthcare offerings to
Vision through achieving govern- private sector. This will in turn individual/society-based care
mental operational excellence, reduce the cost of care on the offering to Individualize/
supporting digital transformation, government. society-based care, offering
enabling the private sector, comprehensive services to all.
developing economic partnerships, • The programme also aims to
and promoting social development, encourage economic diversity and • The programme depends on the
in addition to ensuring the development, in addition to principle of value-based care to
sustainability of vital resources. boosting competition. ensure transparency and financial
sustainability by focusing on
• Has Eight strategic themes, • The programme also seeks to screening and prevention to
including Transforming Healthcare. attract Foreign Direct Investment decrease overall burden.
and improve the balance of
payments • Additionally, the programme aims
to improve access to care through
increased coverage, enhance
geographical presence and
distribution of providers, and
expand e-health services and
digital solutions.

• The programme will focus on

patient satisfaction and outcomes
while following the best evidence
based international practices.

• The Health Sector Transformation

Programme also works on
harmonizing and coordinating
between all health sector entities,
VRPs and relevant government
entities, in addition to aligning and
linking with strategic national goals
during the transformation journey

Exhibit 15: Health Transformation Strategic Objectives, Saudi Arabia 2018

1. Adequate number of beds and infrastructure 1. Best quality of services with total cost control
2. Availability of staff 2. Reliable and accountable care
3. Geographical distribution of healthcare 3. Best patient outcomes and effective
Qua
providers
re lity medical treatment
4. Timely Access to Service ca o 4. Stakeholder experience
5. Affordability
to

fc
ss

are
Acce

Health transformation
Strategic Objectives
tion

Tra
ven

ffic
e
pr

sa
k fte
ris ly
Health 1. Strategies to decrease fatalities
1. General Preventive Health, with focus on 2. Managernent of Injuries
Awareness and Vaccination 3. Rates of serious violations
2. Health Crises Management, such as epidemics,
natural disasters and military conflicts

15
Healthcare Market Assessment of the KSA

The transformation of the Kingdom’s healthcare sector in alignment with Vision 2030 also constitutes
the detachment of the three roles currently provided by the Ministry of Health, which will direct the
ministry's endeavours towards regulating and overseeing the health sector, without consuming its
efforts in other tasks. This process serves as the cornerstone of the sector's development. The service
provision role will be undertaken by regional companies, known as clusters, in a concept described as
accountable care organisations while a government holding company will take charge of financing
service provision.

Exhibit 16: Role of MOH in the New Health Transformation, Saudi Arabia (2018)

Detachment of the Current role of MoH

LEGISLATIONS SERVICE PROVISION FINANCING

Ministry of Health
MINISTRY OF HEALTH REGIONAL COMPANIES HOLDING COMPANY

HEALTH CLUSTERS THE PROGRAME FOR

Ministry of Health role by 2030: MINISTRY OF HEALTH ACCOUNTABLE CARE HEALTH ASSURANCE
Regulation and overseeing the health sector
Without diverting its efforts into other tasks ORGANISATIONS AND PURCHASING

To achieve this transition, the Kingdom identified multiple transition programmes,

as stated in the diagram below:

Exhibit 17: Health Transformation Programmes in Vision 2030

Private Sector
Corporatisation and Healthcare Model Participation Programme

Health Insurance Health Transition

PP ru'r rhaaT en;HealthdaHn
Services Programmes Governance

E-Health Workforce

16
Healthcare Market Assessment of the KSA

These programmes have opened doors for multiple investment opportunities in key areas identified
by the national transformational programme, as below:

Exhibit 18: Key Investment Areas, Healthcare

Increased use of Healthcare

Additional private Increased medical
information Education
medical facilities insurance
technology

Provision of Enhanced Local

improved training professional manufacture of
facilities development pharmaceuticals

3.1.2 ACOs (Accountable Care Organisations)

As part of the National Transformation Programme and the Ministry’s direction towards offloading the
provision of care and taking a more active role in regulations and governance, the Accountable Care
Organisation initiative was rolled out. Currently under progress and expected to be completed by year
2030, the initiative focuses on grouping current providers into 22 clusters, (previously referred to in
Exhibit 2) which are accountable care organisations that are responsible for a population set. Each
cluster will comprise a tertiary care hospital, supported by a number of secondary hospitals and numer-
ous primary healthcare centres. The main objective of the MOH is to achieve the continuum of care
and reduce and decrease the burden of disease by focusing on primary healthcare, which revolves
around promotion of health, prevention of disease, management of illness and
rehabilitation.

Exhibit 19: Accountable Care Organisations - model

Tertiary Hospital Secondary Hospitals Primary Healthcare Clinics

Assign Clusters
Assign 22 dusters across KSA

Regulat Clusters
Licensing, regulation and governance

Supervise Clusters
Ensure KPIs are followed

17
Healthcare Market Assessment of the KSA

3.1.3 NCP - National Centre for Privatisation

The National Centre for Privatisation & PPP (NCP) is an entity created to enable the privatisation and
public private partnerships (PPP) for all 10 targeted sectors within the Vision 2030. Health sector’s
privatisation process is following the approved timeline set by the Privatisation Supervisory
Committee (PSC). The first step is already underway, which is the establishment of a State Holding
Company and five regional companies to promote institutional transformation and restructuring
within the health sector. PSC did a full-scale study of the health sector, which produced nine different
areas that would benefit from privatisation and/or PPP. The areas include:

Exhibit 20: Areas to benefit from privatisation and PPP

• Health Centre • Healthcare Extended Care. • Radiology • Laboratory • Pharmacy

Development Logistics Including:
• Hospital Operations • Long Term Care &
•New Medical Cities Rehabilitation
• Home Care

The study also involved the following:

• Turning King Faisal Specialist Hospital & Research Centre (KFSH&RC) into a not-for-profit
organisation working to advance specialised healthcare and medical research, enhance patient
experience and focus on academic medical training.
• Governmental programme to adapt Value Based Healthcare by buying health services and
insurances for Saudi citizens.
Vision 2030’s privatisation of healthcare is to provide the best services and patient care as well as
extend its reach and efficiency all over the Kingdom. With advancement and efficacy of the
healthcare system, the Kingdom hopes to establish a competitive healthcare market, using best
global practices and standards as well as offering sustainable work opportunities to all Saudi
nationals.

3.1.4 Focus on privatisation

In April 2018, the Kingdom of Saudi Arabia announced an ambitious privatisation plan, which includes
14 public-private-partnership (PP’) investments to be completed across 10 sectors, including
healthcare.
The key targets of the privatisation plan in relation to healthcare include:

18
Healthcare Market Assessment of the KSA

Exhibit 21: Healthcare Target for Privatization Plan

Updating and expanding primary care

across the country

Providing additional rehabilitation and

long-term care beds across the country
through the PPP model

Planning for the establishment of

additional medical cities

Preparing KFSH&RC for privatisation

and help it in achieving a leadership
position by focusing on innovation

Updating and expanding laboratory and

radiology services across the country in
partnership with the private sector

Privatisation is also seen as a key focus area in the Saudi Vision 2030 and the National Transformation
Programme (NTP). The strategic objectives stated for healthcare in the NTP include:
• Privatisation of two medical cities through a PPP scheme: King Faisal Medical City in Asir and The
Prince Muhammad bin Abdul Aziz Medical City in Al Jouf
• Increasing private sector share of spending in healthcare through alternative financing methods
and service providers
• King Faisal Specialty Hospital transformation: King Faisal Specialist Hospital to transform into an
independent entity by the second quarter of 2022. It is still to keep maintaining its role as an entity
hosting multiple internationally recognised centres of excellence, a leading research centre in addi-
tion to its leading role in academic and clinical training. As part of that, King Faisal Specialist Hospital
& Research Centre (KFSHRC) has formed the King Faisal Specialist Hospital Internationa Holding
Company (KFSHI). KFSHI, being the investment arm of KFSHRC, supports its commercialisation
strategy, by pursuing profitable strategic investments in healthcare and related sectors therebycon-
tributing to KFSH&RC’s financial sustainability. This along with the overall strategy to cater to
patients paid for by insurance and other payor types in the Kingdom, support KFSHRC’s plan to
become independent.

19
Healthcare Market Assessment of the KSA

Under the new system, state-owned enterprises would provide services once organisational structures
have been completed. Meanwhile, the institutional transformation programme will continue to support
service providers to launch continuous improvement projects, to boost transparent monitoring of health
facilities, in terms of speed and quality access to services, ensure efficient professional development
and accountability based on practical and therapeutic outputs, without any disruption to current
health services during the institutional transformation phase. The immediate focus for the Ministry is to:

Exhibit 22: Ministry of Health Objectives

Adopt future operational model and organisational

structure of state-owned healthcare enterprises
structure

Set up a holding company and five health enterprises

Holdco across the KSA

Health Consortia Initiate health consortia of service providers

Increase operational capacity by

Operational Capacity 25% by 2021

Transform 37% of hospitals and

Transformation healthcare centres into healthcare
enterprises by 2020

3.1.5 Influx of foreign investment

The KSA Private Healthcare Institutions Law (the Law) was amended in 2016 by virtue of a Royal Decree
to attract foreign investment into the Kingdom’s healthcare industry. The amendments, although
touching on only two Articles of the Law, are expected to pave the way for foreign healthcare
entities/companies to establish private healthcare institutions (PHI) with 100% foreign ownership.

PHI are defined broadly under Article 1 of the Law as: “Every health institution which is owned by the
private sector and is prepared for providing treatment, diagnosis, nursing, medical tests or rehabilitation,
or intended for convalescent residence including the following”:

20
Healthcare Market Assessment of the KSA

Exhibit 23: Types of Healthcare Institutionsv

General
Hospitals Medical
Complex

Health Specialised
Support Medical
Centres Cmplex

Health
Institutions
One Day
Surgery Clinics
Centres

Medical
Radiology
Laboratories
Centres

Prior to this amendment, foreign PHI ownership was restricted to hospitals alone and required a
minimum number of beds depending on the hospital’s location and area served; all other forms of PHI
required Saudi ownership, thereby limiting the scope of foreign investment in the healthcare industry
only to major cities.
This has driven foreign investors and medical healthcare groups to view the Kingdom as a lucrative
market, with multiple players exploring various ways to enter the healthcare market and grow, such as
CMC, Mediclinic, and others. The amendment will allow more foreign investors to be a part of the
Kingdom’s transformation as it moves towards having private sector service providers build and oper-
ate government owned health institutions across the Kingdom. The direct impact expected is an
improvement in the overall quality of healthcare providers and institutions, which is in line with the
Kingdom’s Vision 2030.

3.2 Shift Towards Private Sector in Healthcare Delivery

The Ministry of Health (MOH) in the KSA is undergoing a transformational shift “from being an operator
and regulator to solely being a regulator”. This has been resulting in profound growth of the private
healthcare sector, as mentioned in the exhibit below.

21
Healthcare Market Assessment of the KSA

Exhibit 24: Various parameters of increased private sector role in healthcare delivery

Increased service
utilisation

Increased Increased Greenfield Brownfield

government service expansions expansions
initiatives utilisation

3.2.1 Increased Government Initiatives

There has been increasing focus on bolstering the private healthcare sector in the KSA with many
initiatives being undertaken by the Government, e.g.-
• MOH has launched several PPP initiatives in line with its National Transformation Programme, seeking
to expand and improve the country’s healthcare sector through foreign and domestic private
investment.
• In 2017, the Saudi Arabian General Investment Authority- SAGIA (now known as Ministry of Investment
of Saudi Arabia - MISA) provided for 100% ownership to foreign investors in the healthcare sector.
• In 2020, the Government also made a budgetary allocation of SAR 167 Bn (~USD 45 Bn) towards the
privatisation of 295 hospitals by 2030, improvement of medical education and digitisation of patient
records.

3.2.2 Increased service utilisation

Private sector growth is being reflected in its increased share of healthcare infrastructure and service
utilisation, as shown in the next page:

22
 Healthcare Market Assessment of the KSA

Exhibit 25: Increased share of private sector role in healthcare sector (2016-2019/2020)

Private Hospital Bed

Private Hospitals
CAGR
2.8%
19.427
CAGR
2.4%
167

17428

152

2016 2020

2016 2020
Intpatient Admissions
Outpatient Visits
CAGR
9.8%
1.6
CAGR
4.2%
57.4
1.2

50.7

2016 2019

2016 2019

Going further, the private sector is expected to strengthen in the region with many greenfield and
brownfield projects, as discussed under.

3.2.3 Greenfield expansion

There are ~70 planned healthcare projects in the KSA. Of these ~44% are in the private sector with
majority being in key cities like Riyadh, Jeddah, and Dammam, as shown below:

Exhibit 26: Planned private healthcare projects in the KSA (2022-2026)20

Other cities with key healthcare projects include

35% Makkah, Medinah etc. Key private players

39% including large healthcare groups are expanding
6%
in the region with a large pipeline of healthcare
projects for the future. Key planned and
19%
announced investments by private players are
mentioned below.21
Riyadh Jeddah Dammam Other Cities

23
20
Various company websites, JLL - Healthcare Research & Analysis
21
MEED, JLL- Healthcare Research and Analysis
Healthcare Market Assessment of the KSA

Exhibit 27: Projects by key healthcare players in the KSA (2020-2026)

Country Net Project

Investor Project City/ Town (Value (USD Mn Project Status
Region
2022

Batterjee Medical City: General

Al Batterjee Holding Makkah Province Makkah 295 Execution
Hospital

Middle East Healthcare

Saudi German Hospital Riyadh Province Riyadh 40 Execution
Company

Al Murjan Group Al Murjan Medical Centre Makkah Province Jeddah 213 Execution

Dallah Hospital Main Building

Dallah Healthcare Riyadh Province Riyadh 16 Execution
in Al NakheelGovernorate

2023

Sulaiman Al Habib Shamal Al Riyadh Healthcare Riyadh Province Riyadh 240 Execution
Medical Group Hospital

Sulaiman Al Habib Gharb Al-Takhassusi: Maternity

Riyadh Province Riyadh 19 Execution
Medical Group and Paediatric Hospital

Sulaiman Al Habib Sulaiman Al Habib Hospital in

Riyadh Province Riyadh 426 Execution
Medical Group Al Sahafa

King's College King's College Hospital Makkah Province Jeddah 85 Execution

Sulaiman Al Habib
West Jeddah Hospital Makkah Province Jeddah 77 Execution
Medical Group

Al-Medinah
Soliman Fakeeh Hospital Soliman Fakeeh Hospital Medinah 45 Execution
Province

2024

Sulaiman Al Habib
Al-Kharj Hospital Riyadh Province Al Kharj 96 Execution
Medical Group

Mouwasat Medical Mouwasat Hospital in Yanbu Al- Medinah

Yanbu 86 Bid Evaluation
Services Industrial City Province

Sulaiman Al Habib Al Muhammadiyah Hospital in Makkah

Jeddah 83 Execution
Medical Group Jeddah Province

2025

Sulaiman Al Habib Medinah Hospital in Mitan Al- Medinah

Medinah 100 Study
Medical Group Province

Haif Company Olaya Hospital Riyadh Province Riyadh 110 Design

Dallah Integrated Healthcare Makkah

DAG / SAJCO Jeddah 250 Design
Hospital Province

24
 Healthcare Market Assessment of the KSA

3.2.4 Brownfield expansion

Private players are also expanding through the brownfield route with many high value deals being under-
taken in the healthcare sector in last few years. Some of the recent transactions are mentioned below.

Exhibit 28: Recent M&A transactions in the KSA (2018-2022)22

Target Deal Share (%) EBITDA

Investor Year Company Type of facility Value Acquired Multiple Description of the deal
(USD Million)

United Eastern Medical

Multiple hospitals Services is a UAE-based
United Eastern of multiple integrated healthcare
Jadwa Healthcare group that specialises in
2016 Medical Services specialised NA 42% NA
Opportunities Fund the women, fertility, and
(UEMedical) healthcare children’s healthcare
formats segments across the KSA
and UAE.

UEMedical acquired a
Specialised controlling stake in Al
United Eastern Al Muhaideb Dental healthcare Muhaideb Dental Clinics
Medical Services Clinics Group format Group in Saudi Arabia
2019 136 NA NA
which has assets including
(UEMedical) 46 dental clinics in Riyadh,
Jeddah, Abha, Makkah
and Al Qassim.

Hassana is the investment

arm of the General
Hassana Investment Organisation for Social
Company Insurance (GOSI) in the
2019 NMC Health General Hospital NA NA NA KSA. NMC and GOSI
agreed to a well-defined
long-term sustainable
growth plan for the JV.

Specialised Acquisition of majority

Makkah Medical stake is part of Dallah's
Dallah Healthcare 2020 healthcare 43 78.6% NA expansion strategy in
Centre
format Makkah region.

Amanat Holdings has

acquired CMRC, a leading
Cambridge Medical Specialised post-acute care and
Amanat Holdings 2021 and Rehabilitation healthcare 232 100% NA rehabilitation (PAC)
Centre (CMRC) format provider in the UAE and
KSA from TVM Capital
Healthcare.

NMC Health sold 53% of its

stake in Saudi Medical
Care Group (SMCG),
marking its final
international asset sale as
the company prepares to
Multiple complete its
Undisclosed 2022 NMC Health NA NA NA administration process.
hospitals
The company expects the
transaction to be
completed by the second
half of 2022, without
identifying the buyer or
specifying the deal value.

25
22
Various company websites, JLL - Healthcare Research & Analysis
 Healthcare Market Assessment of the KSA

Healthcare expansions are also being fuelled by recent and planned IPOs. The KSA’s IPO market proved
to be more resilient than expected in 2020 during the COVID-19 pandemic. Key SMEs are of the opinion
that sectors like healthcare, energy, retail, and technology will have a strong pipeline of IPOs in coming
years. Many recent and planned IPOs in the healthcare sector are mentioned below:

Exhibit 29: Recent and planned IPOs in healthcare sector in the KSA

Establishment Key assets and Offered shares Share Capital

Company Listing Year of total and %) value raised Other details
Year operations
(number

5.25 million
Operates hospitals, shares (or
outpatient clinics, A total of 224,440 retail
10% of the
pharmacies, and investors subscribed to
total offered
Dr. Sulaiman Al Habib medical labs 5.25 million shares at a
shares
Medical Services throughout the KSA total value of nearly
1995 2020 amounting SAR 50 USD 700 Mn
Group Co.23 as well as in Dubai SAR 1.9 billion
to 52.5
and Bahrain million) were
allocated to
the retail
investors

Headquartered in
Jeddah, AME is a Company’s Price
medical supplies current guid-
company that The company was
capital is ance
distributes, and transformed to a Saudi
SAR 70 per
AME Company for markets medical joint stock company in
million, share:
Medical Supplies (AME) products, supplies, June 2021.
2009 2022 divided into SAR 50 NA
equipment, and AME Co. for Medical
seven million
devices used mainly Supplies’ IPO prospec-
shares with a
in the field of tus was issued in
nominal
cosmetics and December 2021.
value of SAR
plastic surgery in the 10 per share.
KSA

25% stake of
Arabian International its total The CMA approved the
Healthcare Holding Co. ~USD 53 IPO in Dec 2021.
Leading healthcare million Tibbiyah allocated 20%
(also known as 1973 2022 SAR 82 NA
provider in the KSA capital of the total offered
Tibbiyah, owned by Al
Faisaliah Group)24, 25 shares to qualified retail
~5 million investors in March 2022
shares

KSA’s Capital Market

Authority (CMA)
approved the share
The
One of the largest offering in Dec 2021.
company
retail pharmacies in Nahdi Medical Co.
raised about
Al Nahdi Medical Co. the country that made a strong market
USD 1.36 Bn
30% debut in March 2022
(50% owned by manages and in KSA’s
of total, opening 16.8% above its
Jeddah-based 1986 operates a network 2022 SAR 153 largest IPO
~39 million initial public offering
investment firm Sedco of pharmacies with since oil
shares price.27 The successful
Holding)26 more than 1,100 giant Saudi
outlets across ~145 listing of Al Nahdi
Aramco went
cities and one in UAE represents a rare IPO by
public in
a pharmacy chain and
2019.
ranks it among one of
the largest in the
industry.

23
Argaam: Saudi Arabia to see more IPOs in tech, retail, healthcare; set for bumper 2021 • 24 Zawya: Saudi CMA approves listing of Al Nahdi Medical, SHL in new wave of IPOs
26
25
Arab News: Al Faisaliah Group’s Tibbiyah Holding to offer 25% stake in IPO on Nomu • 26 Gulf Business: Saudi pharmacy chain seeks $1.3bn in top IPO since Aramco
27
Reuters: Saudi pharmacy firm Nahdi soars on debut after $1.36 billion IPO
 Healthcare Market Assessment of the KSA

Establishment Key assets and Offered shares Share Capital

Company Year operations Listing Year of total and %) value raised Other details
(number

Planned IPOs

The CMA approved the

IPO in Dec 2021
The company would be
One of the largest listed on Tadawul’s main
pharmaceutical retail market.
30% stake of
companies in the The shares will be
Al-Dawaa Medical its capital of Seeking to
KSA, has a chain of SAR offered for subscription
Services Company28 SAR 850 Mn, raise about
1993 over 800 pharmacies TBD to retail and institution-
across the country equivalent to 65-73 USD 500 Mn al investors. 100% of the
together with online 25.5 million from the IPO offer shares will be
shares
and wholesale offered to institutional
channels investors, with a
clawback to retail
investors of up to 10% of
the offered shares.

Would be listed on KSA

30% of the main index, TASI
One of the leading
Scientific and Medical company’s Members of the eligible
companies special-
Equipment House capital (SAR party are to subscribe
2001 ised in building and TBD SAR 62 NA
(SMEH, A member of 200 Mn) with to a minimum of
operating health
the Arifi Group of 6 million 100,000 shares, limited
facilities in the KSA
Companies)29 shares to a maximum of
999,999 shares.

3.3 Large, planned developments in the KSA acting as

key drivers for healthcare investments

There are many large current and planned infrastructure developments in the country like mega
projects, mixed-use projects etc. These developments are expected to provide a large population
base, which acts as a major healthcare driver. In addition, social developments like retail, healthcare,
education etc. need to be planned along with these projects. Therefore, the healthcare market is
expected to get a boost owing to these planned developments.

Key upcoming mega development projects in the KSA include ROSHN project, Neom City project,
Diriyah Gate Development Authority project, Diplomatic Quarter (DQ) project, Jeddah Economic
project etc. These mega projects are expected to drive growth of the healthcare market.

28
Arab Business: Saudi pharma major Al-Dawaa Medical Services Company plans IPO
27
29
Arab News: Saudi Scientific & Medical Equipment House sets IPO price range, book-building imminent
Healthcare Market Assessment of the KSA

3.4 Market Shift Towards Specialised Formats

Analysis of upcoming supply in the KSA’s private healthcare sector indicates that majority of the new
projects are in the key cities of Riyadh and Jeddah. Also, more than 75% projects are for
multi-speciality/general hospitals, with many established private players focusing on this format e.g.,
Sulaiman Al Habib Hospital in Riyadh, Haif Company Olaya Hospital in Riyadh, Al Murjan Group Hospital
in Jeddah, King's College Hospital in Jeddah etc. A few private players have announced investment in
specialised care segments e.g., Sulaiman Al Habib Maternity and Paediatric Hospital in Riyadh.

Exhibit 30: Upcoming healthcare projects by region and format in the private sector

100%=31 100%=31
Medical City

6% Multispeciality/
6% General Hospital
19% Riyadh Primary Care
10%
Jeddah Specialised hospital
6% 39%
and hospitals with
Dammam centresof Excellence
Other cities 77%
35%

Public sector healthcare projects are quite geographically distributed with ~55% projects being in cities
other than Riyadh, Jeddah, and Dammam. Also, public sector has many large, planned healthcare
developments, like medical cities and university hospitals along with many specialised hospital formats
projects including SABIC - Riyadh Behavioural Care Hospital, Ministry of Health - Mental Health Hospital
in Abha, MOH - Jizan Obstetrics and Gynaecology Hospital, Royal Commission of Riyadh City - Hittin IVF
Infertility Hospital etc. The MOH is also planning for PPP projects in several areas, starting with extended
care facilities and medical cities in selected clusters.

Exhibit 31: Upcoming healthcare projects by region and format in the public sector

100%=40 100%=40
Medical City
5% 3%
13% Multispeciality/
Riyadh General Hospital
23%
Primary Care
Jeddah 48%
55%
Specialised hospital
28% Dammam 10% and hospitals with
centresof Excellence
Other cities
18% Universtity Hospital

Going further, significant opportunities exist in the comparatively lesser developed regions of the KSA
along with special specialised formats.

28
Healthcare Market Assessment of the KSA

3.5 Medical Insurance Growth

In 2016, KSA began the implementation of a mandatory unified health insurance scheme aimed at ensur-
ing that all citizens and residents of KSA are medically insured.

Exhibit 32: Roll out strategy of mandatory insurance in KSA

2016 2020
Unified Health Insurance Visitors health Insurance
Policy (P1&P2)
New decisions: virtual card.
First introduction of mandatory Introduction of mandatory
unified insurance policy insurance for Hajj and visitors
(one policy for all company starting Jan 2020
workers and dependents) (a committe was formed to
phased to 4 phases oversee the initiation
2009 Phase 1 : Companies of this in 2014)
Mandatory for working with size of (100+) 2018
Saudis Phase 2 : (99-50) Modified unified policy
1999 Health insurance
First Introduction mandatory for CCHI announced adding
Saudi workers a new covarage for bariatric
First Introduction
(not families) sleeve heart valve and
of health insurance
autism and others
(not mandaory)

1999 2005 2009 2014 2016 2017 2018 2019 2020 2021

2021
2005 2017 COVID Response Cont.
Mandatory for workeing Expats Unified health insurance 2020 Telemedicine
Health insurance policy (p3&p4) COVID Response coverage to
mandatory Comtinuation of COVID Response: stay extended
for expat workers introduction policy Started a trial of till end of 2021
(not families). 1st july Phase3: companies 2019 90days coverage
with size of 49-25 MAndatory for for telemedicine
Pahse 4: (below 25) Saudi dependents and childimmunization
Health insurance through home
mandator for care sevices,
all Saudi workers’ got extended
2014 samily members till end of 2020
Mandatory for
Expat Dependents
Health insurance mandatory
for all expat workers’ family
member 1st Sept.

• In July 2016 KSA began implementing the mandatory unified health insurance scheme, with the goal
of ensuring that all expats and nationals residing in KSA are covered by health insurance.
• This initiative is ensuring major issues in terms of healthcare accessibility are resolved for all residents
of the Kingdom.

Private health insurance coverage has been increasing in the country, as mentioned below:

29
 Healthcare Market Assessment of the KSA

Exhibit 33: Total Private insured population in KSA in Million (2011-2022)30

2.2%

12.3 12.9
12.1
10.8 11.1
9.9 9.6 9.9 9.9 10.1
7.9 8.7

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022*

The numbers of privately insured population grew at a CAGR of 2.2% to include approximately 10.1
million population in 2022. The insurance market saw a dip in its penetration in the year 2019, attributed
to the implementation of expatriate visa renewal fees, which led to a few expatriates leaving the
country. As of 2022, ~29% of the total population had access to private insurance. Going further, with
many initiatives to increase health insurance coverage, the share of insured population is expected to
increase.

30
30
CCHI, *2022 numbers are as of 1st March 2022, as published by the Saudi Council for Cooperative Health Insurance (CCHI)
 Healthcare Market Assessment of the KSA

Section 4: Summary and Conclusion: Market Potential

A large youth base and a rapidly ageing population with prevalence of chronic diseases are expected
to triple healthcare demand in the next 10 years.31 Rising prevalence of chronic diseases, untapped
potential for localisation, and a well-established regulator ensuring ease of doing business, all add to
the value proposition of investing in the healthcare market of KSA.
Going further, market growth will be driven by the following key opportunities:
• PPP initiatives: Healthcare remains a top priority in the KSA with increasing private sector
participation through various PPP initiatives leading to growth of the healthcare infrastructure
• Specialised healthcare formats like Dental, Dermatology, Extended care etc.
• Establishment of medical cities and COEs in specialties like Cardiac sciences, Orthopaedics, Oncology etc.
• Primary healthcare: Focus on family and community medicine along with preventive health and wellness
• Healthcare retail segment
• Local manufacturing capabilities in pharmaceuticals, medical equipment, and consumables
• Medical research in new areas of healthcare applications like Stem cell in specialties like Oncology,
Organ transplant, Immunology etc.
Healthcare providers that have a high focus on high-end technology (clinical and IT) will have an
advantage in the market as upgraded clinical technology helps significantly in attracting patients as
well as star doctors and staff in addition to ensuring best patient outcomes. Ensuring smooth patient
pathways and patient flow within healthcare facilities will help providers in differentiating their service
offerings and being aligned with KSA’s healthcare transformation vision. Increasing insurance
penetration in future would boost the healthcare market access. The standardisation of healthcare
delivery through establishment of New Model of Care will further ensure quality of care in the Kingdom.
Opportunity also exists in the underserved health regions of the KSA, like development of healthcare
clusters in Riyadh 3rd region, Baha region, Asir region and Alqunfudhah region etc. Also, there are
greenfield projects coming up in underserved regions, like Abha Private Hospital project, Sulaiman Al
Habib group’s Al-Kharj Hospital etc. signifying growing opportunities in remote areas as players are
increasingly investing in these underserved regions. Growth in these markets is also expected to drive
the overall growth in the healthcare market in the Kingdom.

31
31
Ministry of Investment