Private hospitals cash in - Health insurers eye windfall

KUWAIT: At Sabah Hospital, it is no longer business as usual. The wards appear to be empty with few patients around. At the male ward, Kuwait Times spoke to one of the patients (or rather the only patient) in a room that usually accommodates at least eight, as he packed his things to leave the hospital. "I can't afford to pay KD 10 per day - it's not worth it. I would rather go to a private hospital," said Afzal, a Pakistani expat. At the Al-Razi Hospital too, the halls were quiet and mostly empty.

Hospital staff may be glad over the reduced number of patients, but the expat medical staff is not happy with the increase in fees, which they too must pay. From Sabah Hospital to Adan Hospital, the mood appears to be the same. "Why should I pay KD 10 just for a mere consultation?" asked a male nurse who spoke on the condition of anonymity. "I have been working here at Adan Hospital for nine years. I have never seen anything more demoralizing than this," he added, referring to the hike in medical fees.

The new medical fees stipulate that all expatriates including doctors, nurses, pharmacists, medical lab technicians, etc, pay KD 10 (instead of KD 2) at hospitals and an extra KD 10 for each day an expat stays in the hospital, in addition to other additional charges. "When it was KD 2, we never complained. But an increase of 500 percent is really something else," he lamented.

Most of the doctors and paramedics interviewed echoed the same sentiments. According to a ministerial decree issued by health ministry, the new health fees for expatriates for using services at public hospitals is now KD 10, and a stay in public wards costs KD 10 per day (which was completely free before). Expatriates in Kuwait are already required by law to pay an annual health insurance of KD 50 in order to renew their iqamas. This KD 50 health 'insurance' fee is still required despite the rise in fees at hospitals and clinics.

Also, a stay in the intensive care unit now costs KD 30 per day, while a stay in a private room at a public hospital is KD 50 per day with a KD 200 deposit. These fees do not include surgeries, laboratory tests and x-rays. Moreover, a medical checkup at the public maternity hospital now costs KD 10, while the delivery charge is KD 50, among others. A few days after the hikes, public hospitals recorded a 30 percent drop in the number of expatriate patients, Health Minister Dr Jamal Al-Harbi said, as expats shunned public hospitals and clinics.

Health insurers

Meanwhile, as public hospitals keep recording a decline in the number of patients, private hospitals and insurance companies in Kuwait are cashing in. Private hospitals and clinics in Kuwait have witnessed a sharp increase in the number of patients visiting their facilities since the government implemented the new fees. Several of those who spoke to Kuwait Times said some private hospitals, in the face of a sudden rush of patients, were forced to refurbish their infrastructure facilities and boost their workforce. This in turn brings more investment into the sector and creates more job opportunities, giving a new momentum to the healthcare segment of the private sector.

"I can say for certain that we have recorded at least a 25 percent rise in patient numbers since October 1. There is also a considerable spike in the number of visitors who come for medical tests such as blood tests, ECG, x-rays, ultrasound test, CT scan, endoscopy, colonoscopy, routine urine microscopy, urine cultural sensitivity tests, etc," said Yousef, an administrator at a private hospital. While admitting that the government decision is indirectly helping private medical facilities in the country, he declined to comment on a popular belief that the harsh move was initiated to aid private hospitals.

At a private hospital in Salmiya, Kuwait Times spoke to a young couple who just had their new baby. "We really thank God for the new baby. The hospital staff is nice and caring and the charges here are really affordable. Their services are better," said Rose, a European expat.


Interestingly, medical insurance companies in the country have begun to see a windfall of opportunity in the perceptible shift of expat patients from government hospitals to private medical facilities. For expats, the exorbitant fees for healthcare services in the public sector have forced them to seek medical services in the private sector, thanks to insurance companies.

"I have to pay only 10 percent or 20 percent of the total charges for the services now, depending on the medication or tests I undergo and the rest is covered by my insurance company. This is manageable for many people like me," said Pulikeshi, an Indian expat who works in a private company.

Many like Pulikeshi are now covered by private health insurance companies who are tied with a vast network of healthcare providers consisting of all major hospitals, private clinics, laboratories and pharmacies in Kuwait. The private healthcare insurance market in the country is flourishing as a result of the shift of patients. In Kuwait, all major insurance companies are currently offering attractive health insurance products, setting the stage for fierce competition.

"For health insurers like us, this is the right time to cash in on the flow of patients to the private sector. For the next five years or so, the companies are going to bank on the opportunity. And once the impact of the settlements begins to feel, insurers could resort to reinsurance to spread liabilities," said John Abraham, a health insurance specialist. However, he predicted that after a period of 10 years, insurance companies may have to eventually incur losses unless the government brings in some drastic policy changes.

Usually, insurance companies divide the amount the policyholder pays by the amount he/she uses and multiply it by a number. Then they make assessments based on this figure and decide if they should increase the premium. Many companies also limit costs for a particular treatment within a calendar year, in addition to having an overall annual limit for all treatments.

The human dimension

Many expats and MPs have urged the government to reconsider the move - arguing that the average incomes of most of the foreigners working in the country cannot support the increase. "There is an urgent need to consider the human dimension and the average income of a large number of foreigners," MP Khalid Al-Otaibi said. MP Waleed Al Tabtabaei called for widening the scope of health insurance instead of raising medical fees. He suggested a clear health insurance scheme to help foreigners instead of resorting to higher medical fees.

On the other hand, some Kuwaiti lawmakers have launched aggressive media campaigns advocating against providing services to foreigners for free or at affordable prices. They argue that with the drop in oil prices, the country can no longer afford to foot the bill for the expatriate population, which constitutes more than two thirds of Kuwait's population.

Hospitals for expats

Meanwhile, the annual health insurance fees for expatriates will be increased to KD 130 as new hospitals and clinics that will exclusively serve foreign residents are being built. The Health Assurance Hospitals Company (Dhaman) last month inaugurated such a hospital in Ahmadi governorate in a groundbreaking ceremony. The hospital is one of the main components of the healthcare system for expatriates, which is implemented and managed by Dhaman as a leading development model for public-private partnership within the government's work program and development plan.

Dhaman CEO Dr Ahmed Al-Saleh said according to ministry decisions, health insurance for expats will cost KD 130 annually. Over two million expats working in the private sector and that their families will benefit from the Dhaman health services in various governorates. Two additional hospitals will be built in Farwaniya and Jahra, in addition to 12 medical centers, which will reduce crowding at public hospitals and primary healthcare centers.

By Chidi Emmanuel and Sajeev K Peter