Health October 16, 2019
Investing in Dubai’s healthcare sector

By Dr Ibtesam Al Bastaki, Ahmed Faiyaz Sait, Sarah Cartledge - World Healthcare Journal

Increase in demand for quality health services due to Dubai’s rapid urban development, population growth and influx of medical tourists is one of biggest challenges facing the Dubai Health Authority. Many of world’s largest hospitals and specialised centres have invested in Dubai’s healthcare sector after realising the city’s unique investment climate, which provides a number of investment incentives in the healthcare sector.

Dubai’s appeal is the result of visionary leadership and of carefully considered policies designed to create a thriving economic environment and an attractive lifestyle. The city at the heart of the emirate of the same name is firmly anchored as a favourite destination for expatriates and visitors, as their ever-growing numbers attest. Sustained by an active population and state of the art infrastructure, Dubai is continuously improving and developing as a city, as a hub and as a gateway.

Dubai is home to a young and fast-growing population, expected to reach 4.2m in 2025. It expanded by 8 per cent between 2014 and 2016 and 83 per cent is aged between 15 and 64. At the same time, the amount of tourists visiting the emirate has increased by 8 per cent since 2011, and it has the highest ratio of visitors to residents in the world.

The Dubai Health Authority (DHA) was created in June 2007 by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, Ruler of Dubai. DHA is the public organisation overseeing the health system in Dubai and its free zones (excluding DHCC and MOHAP) with an expansive vision that includes strategic oversight for the complete health sector in Dubai and the enhancing of private sector engagement.

Two other agencies coexist within Dubai’s healthcare sector: the Ministry of Health and Prevention (MOHAP), the federal ministry overseeing the UAE healthcare sector, and Dubai Healthcare City Authority (DHCA), a dedicated free zone. Both have a role in the regulation, licensing, funding, and management of facilities under their oversight. However, most of Dubai’s healthcare facilities and professionals are overseen by DHA and only a limited number by MOHAP or DHCA.

In 2014, a mandatory health insurance law for Dubai was enacted and rolled-out in three main phases, so that by the end of 2017 every employee and dependent residing in Dubai was medically insured. As a result, close to 100 per cent of Dubai’s population is now covered by medical insurance. While healthcare expenses have reached around AED 17.5bn in 2017, the share of private insurance has skyrocketed to approximately 60 per cent.

DHA Strategy 2016 – 2021

Dubai’s healthcare funding strategy supports the growth of the private sector. The numbers of healthcare facilities and professionals licensed by DHA have seen significant growth in recent years.

Founded on the four key pillars of service delivery (quality, efficiency, patients and staff), DHA aims to ensure the availability of quality medical insurance programmes, improve medical services according to the highest international standards, contribute to providing attractive infrastructure for investments, boost Dubai’s position as a global hub for medical tourism and medical education, encourage innovation in the healthcare sector and improve preventive healthcare measures.

DHA is striving to make the population of Dubai healthier and happier by providing world class healthcare services; fostering creativity and innovation in alignment with UAE vision and Dubai plan 2021,” His Excellency says.

Drivers for Health Investment in Dubai

The economy in Dubai is already diversified and the healthcare sector only accounts for 3.6 per cent of the country’s GDP. But with a growing population there is a greater need for health services within the country. In addition, the Dubai Expo 2020 will bring a further 25m visitors while both airports are expected to handle 310m passengers annually. With new landmark attractions and increased real estate projects, Dubai is preparing for a greater healthcare need in the near future.

A high prevalence of chronic and noncommunicable diseases has indicated an increased need for health services and for associated tertiary care expertise and chronic disease management. Cardiovascular diseases and cancer were the main causes of mortality in Dubai in 2016, accounting for over 51 per cent of deaths, three times higher than the UK or Australia. With more prevalence of overweight in adults and more smokers, plus a high diabetes prevalence, prevention and screening are becoming more important.

A high prevalence of chronic and noncommunicable diseases has indicated an increased need for health services and for associated tertiary care expertise and chronic disease management. Cardiovascular diseases and cancer were the main causes of mortality in Dubai in 2016, accounting for over 51 per cent of deaths, three times higher than the UK or Australia. With more prevalence of overweight in adults and more smokers, plus a high diabetes prevalence, prevention and screening are becoming more important.

A supply gap exists in specific types of services, offering opportunities to the private sector in chronic disease management, tertiary care, mental health, rehabilitation and physical therapy, and centres of excellence in tertiary care.

Dubai is supporting and embracing the digital revolution and innovation in the healthcare sector. Revolutionary usage of 3D printing is playing a key role in procedural planning, quality assurance and advanced education and has already been used in kidney assistance surgery and in catheter-based interventional procedures. Robotic surgery has also been used to perform complex procedures with greater precision than with traditional methods in specialities such as cardiology, orthopaedics and OBGYN.

DHA Investments & PPP’s Department

DHA’s Investments and PPPs department provides strategic support and facilitation to investors. Its role is to support DHA’s objective of providing healthcare in line with global best practices, fostering innovation in all health-related sectors and of becoming a medical hub for the region by attracting investors and encouraging these to contribute to the development of targeted areas.

 

It provides real-time information on demand for services, supply and capacity gaps in the Dubai healthcare sector. It facilitates priority investments and offers commercial incentives through Certificate of Needs policies. It supports and advises on investment mandates on greenfield investments exceeding AED 100m, drives policy change to enable priority investments. It also facilitates discussions with other DHA and Dubai Government stakeholders on sizable investment mandates, and facilitates and manages PPP process for partnerships with DHA for priority services/ identified projects.

The Health Regulation Sector at DHA is responsible and accountable for regulating all health facilities and healthcare professionals in the Emirate of Dubai with the exception of those that fall under the jurisdiction of the Ministry of Health and Prevention (MOHAP) and Dubai Healthcare City Authority – Regulatory (DHCR). The Health Regulation Sector takes a proactive, friendly and flexible approach toward regulation in order to drive high quality and safety in healthcare.

Setting up a health facility in Dubai is now an easy and smooth process, optimised by digital procedures. Investors wishing to open a health facility in the Emirate of Dubai and/or one of its free zones (excluding DHCC) will follow a different journey, based on the nature of their project (new constructions vs. refurbishments/ expansions).

Dubai FDI is a partner for foreign investors in healthcare. Part of the Department of Economic Development in Dubai, it provides essential information and invaluable support to foreign businesses looking to invest in Dubai’s thriving economy and take advantage of its global strategic importance.

Dubai is one of the top global city destinations for FDI capital. Over the 2015-2017 period, Dubai FDI registered 22 healthcare projects, accounting for more than USD 105m of CAPEX. The diversity of the projects, from speciality hospitals and outpatient care centres to medical equipment and research & development, showcases the multiple development possibilities existing in Dubai.

Investment focus areas

As the age of the population rises in Dubai, the need for long term care and rehabilitation will rise. Areas such as orthopaedics, oncology, cardiology and neurology already require extended rehabilitation periods, and as the percentage of people over 65 increases from one per cent to three per cent by 2030, the need for geriatric care will also rise.

Multiple studies indicate the burden of conditions treated under these specialities: around one in 59 children suffer from autism, one in 12 has had a disorder related to speech or language in the past year, while a global average of 20 per cent of people aged 20-59 suffers from chronic back pain. In addition, WHO estimates that approximately 15 per cent of the world’s population lives with some form of disability and that two to four per cent suffer from severe disability, the equivalent of disability inferred from quadriplegia, blindness or severe mental disabilities, requiring specialised care services such as physiotherapy or speech/ learning therapy.

It is estimated that more than 124 additional OP rooms and 331 IP beds are required in Dubai by 2025, for specialties like oncology, neurology, vascular surgery, immunology, and respiratory medicine, while it is estimated that more than 15 OP rooms and 115 IP beds are required for cardiovascular surgery, and cardiology & cardiothoracic surgery. Dedicated specialised centres are the most convenient set-up to treat advanced specialties, for addressing the needs of prevention, diagnosis and treatment.

In 2017 alone, four per cent of SAADA patients (all UAE Nationals) accounted for 22 per cent of the health spending on chronic disease management programmes. These programmes have been introduced based on the prevalence of noncommunicable diseases which is particularly high in UAE, where NCDs account for 76 per cent of all deaths - more than 17 per cent of the population suffers from diabetes (20-79 y.o.y), 35 per cent are overweight, and cardiovascular diseases are up to three times higher than in some developed countries.

Chronic disease management can benefit immensely from investments in ambulatory care centres. Dedicated programmes that allow home care, and remote monitoring can considerably lower costs instead of occupying inpatient beds. In addition, telehealth could also support patient monitoring post-surgery or discharge.

Set up of Urgent Care walk-in clinics could help reduce the pressure on ER’s in acute hospitals, and also help address the challenge of rising costs from the utilisation of health services in more expensive settings. Approximately 60 per cent of cases reported in emergency departments in Dubai hospitals are not urgent in nature. By 2025, more than 1,200 OP rooms in Dubai are needed, and these predominantly can address the needs of low income population who are estimated to be 57 per cent of the insured base. Telehealth applications and services could also collaborate with Urgent Care clinics to triage patients, reduce waiting times and improve access to care.

Based on WHO’s international classification of diseases, it is estimated that around 15 per cent of the population suffer from any mental or substance use disorder. The Dubai Clinical Services Capacity Plan has estimated a gap of 231 IP beds by 2025 for psychiatry patients, but mental health patients could be treated through different models, using remote monitoring, and telehealth for mostly follow-ups and low complexity OP cases, to specialised mental facilities for those considered as more severe or requiring long-term attention.

Free Zones in Dubai

Two dedicated free zones, DHCC and DSP are aiding the development of the healthcare, wellness and pharma and other life-science sectors. The new legislation will soon allow 100 per cent foreign ownership of onshore companies and a new 10-year visa.

There are 27 free zones in the Emirate of Dubai covering sectors such as healthcare and science, higher education, art and design, banking and finance, trading, manufacturing, etc. In addition to Dubai Healthcare City and Dubai Science Park, there are two other relevant free zones for investors in healthcare, Dubai Silicon Oasis focused on hi-tech and Dubai Multi Commodities Centre a made-for trade free zone. Dubai Silicon Oasis is also the home to an upcoming 235 bed, state-of-the-art tertiary care hospital and medical university. DSO is an ‘integrated’ city within a city offering a plethora of residential and lifestyle facilities, including over 1,500 villas, numerous apartments, the DSOA University residence and much more.

Amongst many others, the key advantages of free zones in Dubai are:

  • 100 per cent foreign ownership
  • Exemption from personal taxes
  • 100 per cent repatriation of revenue and profits
  • Relatively easier documentation
  • Long term leasing options
  • Simplified recruitment and workforce

Through all these initiatives, Dubai Health Authority aims to grow the healthcare sector in the country through ambitious schemes that include unique investment incentives.

Link for Health Investment Guide - www.dha.gov.ae/Asset%20Library/27012019/eng.pdf


Dr. Ibtesam Al Bastaki, Director, Investments & PPP’s Dept. E: iialbastaki@dha.gov.ae

Ahmed Faiyaz Sait, Advisor, Investments & PPP’s Dept. E: afsait@dha.gov.ae

www.dha.gov.ae


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