Saudi Arabia, as the US, is confronted with the fact of rising costs of health care. According to this piece in the Financial Times, the growth is exponential and demand is outgrowing supply. In order to address the problem, the Saudi government is looking to privatize the health sector, turning government-owned hospitals into private (or at least quasi-private) entities. The trend in rising costs is being paralleled in the Gulf Oil States. It appears that even in oil-rich countries, the limitless demand for health care is more than the governments can handle. There’s a lesson in there.

Saudi Arabia eyes healthcare privatisation
Robin Wigglesworth

Saudi Arabia is planning to privatise large swathes of its healthcare sector to meet surging demand for medical services better, according to a senior Saudi official.

As oil revenue trickles down into the economy and increases household wealth, demand for better healthcare services is rising in the kingdom. But even oil-rich Saudi Arabia is blanching at the spiralling prospective costs and is welcoming private sector involvement.

Dr Manar Al-Moneef of the Saudi Arabian General Investment Authority said the Saudi authorities planned to privatise or outsource the management of the 218 government-owned hospitals.

The government finances more than three-quarters of the healthcare industry, which was “unsustainable given population growth projections, as well as spiralling healthcare costs,” he said.
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