A hospital recruitment squeeze is forcing hospitals to poach staff from rivals amid rising demand for thousands of additional doctors.
As more hospitals and specialist clinics open across the country, greater numbers of operators are having to source from the local market instead of hiring from abroad.
Hospital operators attending a recent investment summit in Dubai complained about the rising costs of recruiting doctors and healthcare staff, and called for a reform of the regulatory framework to address the problem.
The number of physicians in the UAE is 1.5 per 1,000 people, fewer than in Qatar, Oman and Kuwait, according to a report released last week by the property consultancy Colliers International.
The ratio for nurses in the UAE is 2.7 to 1,000 people, again fewer than in Qatar, Oman, Kuwait and Bahrain.
The comparable figures in developed countries are, for example, about 3.7 doctors per 1,000 people in Germany (the highest level among European and North American countries), and 13.4 nurses per 1,000 people in Holland.
Abu Dhabi needs an additional 3,100 doctors by 2020, according to the Health Authority-Abu Dhabi.
“The challenge is some hospitals open up and take physicians from the local market, where doctors remain a very scarce resource, because they have an existing local patient base,” said Binay Shetty, chief operating officer of NMC Healthcare.
“Here [hospitals] had recruited from abroad historically but because of the pace of growth is so quick now, hospitals tend to recruit from the local market and this leads to short term inflation of salaries.”
He was speaking at the Healthcare Investment Conference in Dubai last week.
NMC Healthcare, which employs 440 doctors, expects to increase that number over the next five years as it opens 100-bed Brightpoint Maternity Hospital in Abu Dhabi and a 60-bed general hospital in Dubai Investment Park in first half of 2014, as well as a medical centre in Al Ain in the latter part of 2014 and a 250-bed Khalifa City Hospital first half of 2015.
About 98 per cent of NMC’s doctors are recruited from 18 countries. Mr Shetty said the UAE had historically hired doctors from the Indian subcontinent and the Arabian Gulf, but Europe was becoming a new sourcing market. .
Healthcare operators also blamed the long licensing process for the slow pace of recruitment.
Sobhi Batterjee, Saudi German Hospitals Group’s president and chief executive, said the hiring process took three to eight months, “so you snatch from the next door. So allow organisations to bring in qualified doctors and staff from abroad and give them temporary licenses,” he said.
“Otherwise the cost of health care will rise here and people will travel abroad for health care.”
The Saudi German Hospital, which opened in 2011, has 60 doctors; about 20 per cent of them were recruited from within the UAE.
Mr Batterjee noted that medical consultations cost Dh700 in Dubai and 200 riyals (Dh195) in Saudi Arabia. The average cost of giving birth in a hospital in Dubai is Dh20,000, whereas it is just 5,000 riyals in Saudi Arabia, according to Mr Batterjee.
Ravi Dhir, the chief executive of the investment firm Healthcare Mena, said regulations were the biggest challenge.
“If I open a hospital, I paid for investment for 18 months before a patient comes in,” he said.
The average salary of a specialist doctor in the UAE is Dh75,000 to Dh80,000 a month, and for general physicians it can be around Dh40,000 a month, according to operators at the conference.
The salaries of doctors in the UAE have risen by 5 to 10 per cent, and that of nurses by 3 to 5 per cent over the past couple of years, they said.
Mr Dhir’s group employs 200 doctors in its medical centres and a hospital in Abu Dhabi, Sharjah and Dubai. Fifteen to 20 per cent of them were recruited within the UAE.
Healthcare Mena has 13 medical centres in the UAE and a hospital – the National Hospital, which it acquired from NMC Healthcare in 2011 – in Abu Dhabi. It will acquire six primary care centres in Saudi Arabia and four in Qatar by the first quarter of next year, and that would increase the number of staff to 1,000.
Mitul Modi, the healthcare division director of the executive search firm Carmichael Fisher, said the lack of academic facilities and the misperception of the security situation in this part of the Middle East were hampering recruitment of foreign healthcare professionals.
“Here there is ample funding, but that doesn’t mean paying people will get you the best people,” Mr Modi said.
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Business Insights
- As per the document, there are six filing options, including choosing to report on a realisation basis and transitional rules for pre-tax period gains or losses.
- SMEs with revenue below Dh3 million per annum can opt for transitional relief until 2026, treating them as having no taxable income.
- Larger entities have specific provisions for asset and liability movements, business restructuring, and handling foreign permanent establishments.
Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
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Where to donate in the UAE
The Emirates Charity Portal
You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.
The General Authority of Islamic Affairs & Endowments
The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.
Al Noor Special Needs Centre
You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.
Beit Al Khair Society
Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.
Dar Al Ber Society
Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.
Dubai Cares
Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.
Emirates Airline Foundation
Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.
Emirates Red Crescent
On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.
Gulf for Good
Gulf for Good raises funds for partner charity projects through challenges, like climbing Kilimanjaro and cycling through Thailand. This year’s projects are in partnership with Street Child Nepal, Larchfield Kids, the Foundation for African Empowerment and SOS Children's Villages. Since 2001, the organisation has raised more than $3.5 million (Dh12.8m) in support of over 50 children’s charities.
Noor Dubai Foundation
Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).
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EA Sports FC 26
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Developer: Ubisoft Montreal / Ubisoft Toronto
Publisher: Ubisoft
Platforms: Playstation 4, Xbox One, Windows
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UAE currency: the story behind the money in your pockets
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