Healthcare spending per capita in the Arabian Gulf is growing at more than 5 per cent per year.
Healthcare spending per capita in the Arabian Gulf is growing at more than 5 per cent per year.

Soaring healthcare costs for Abu Dhabi employers



There are some 19,000 procedures listed on Abu Dhabi's new price list for basic healthcare services.

They represent the opening salvo of what looks set to be a long war on escalating medical costs in the capital.

At stake is not just the health of the population but that of the economy as companies come under mounting pressure to absorb healthcare costs while insurers are forced to sell policies below their real market value to compete. The trend is pushing the price of policies up by as much as 20 per cent.

Abu Dhabi health chiefs are struggling to cope with such runaway spending as insurance providers complain of fraud, misuse and waste. Caught in the middle are companies that have until now enjoyed artificially low premiums as a result of a race to gain market share as compulsory insurance schemes are introduced.

Now the healthcare honeymoon is over.

"We used to have employee benefit negotiations with HR managers when insurance policies were used to attract and retain high-calibre employees," says Dr Hazem Al Madi, the chief executive of Green Crescent, a top-five UAE insurer.

"Now all of our meetings are with the financial controllers: don't increase the premium, reduce the benefit - that has been the trend."

Adding to mounting healthcare costs are practices such as "upcoding" procedures performed on patients to generate more revenue for hospitals, over-prescribing medications and duplicate billing, where the same procedure is paid out for twice. Claims are running out of control.

"It's why you see pharmacies mushrooming everywhere," adds Dr Al Madi.

Booz & Co estimates the premium for providing health care to someone covered under the national scheme is just a quarter of the actual per capita cost of public healthcare provision. It cannot last and employers are already being forced to choose between paying more for policies or cutting benefits.

"It feels like the industry is navigating without a compass," says Jad Bitar, a principal with Booz & Co.

Setting mandatory tariffs may help to contain future inflation while also protecting smaller players.

From Dh158 (US$43.01) to fix a broken nose to more than Dh13,000 to remove a lung, every type of medical procedure is catalogued with surgical detail on Abu Dhabi's new mandatory tariff that comes into effect next month and determines prices under the most basic insurance. While some prices will rise, overall it is expected to slow inflation in the sector.

"Theoretically, a standard price list should control inflation but in practice it doesn't happen like this," adds Dr Al Madi.

"A real life example: previously, when a patient went for some physiotherapy, the insurance company would receive an invoice for five or six sessions.

"But after the coding system was introduced, healthcare providers started to use all the codes that fell under physiotherapy - so there was one code for warming the muscle, another for shaving hair and another for doing the massage - we started to receive five or six codes under one service, which is legally legitimate but which increased costs by 300 per cent in some cases."

It is an extreme example but it illustrates the challenges faced by regulators and what can be the blurred lines that separate misuse from fraud.

Mahmoud Ramadan AbuRaddaha is at the sharp end of healthcare reform in the capital, heading the Government prices and product benefits section at Health Authority - Abu Dhabi.

He says a number of initiatives have been implemented this year to address what were structural flaws in the healthcare system, such as an overreliance on consultants to do the job of GPs .

In most developed markets, the health system is triangular with consultants at the top, specialists below them and a larger number of GP's to form the base. But in Abu Dhabi the system has looked more like an inverted triangle.

"The old system compensated the physicians based on competency not necessarily on care delivered. So, if you have the flu and you go to see your GP the GP gets Dh45. If you have the same flu and go to a consultant, the consultant gets Dh125," he says, adding that drove hospitals to over-utilise consultants.

Healthcare spending per capita in the Arabian Gulf is growing at more than 5 per cent per year, according to the World Health Organisation - up from US$843 (Dh3,096) per person in 2000 to $1,224 in 2010. A rising proportion of that is going towards the cost of treating chronic diseases. More than 10 per cent of health spending in Abu Dhabi goes towards treating cardiovascular disease and 8.6 per cent to diabetes.

The prevalence of such chronic conditions has proved lucrative for drug makers. Alpen Capital expects pharmaceuticals sales in the GCC to almost double to $ 10.8 billion by 2020.

Yesterday, Gulf Pharmaceuticals opened a Dh500 million facility in Ras Al Khaimah capable of making 45 million vials of insulin every year for the treatment of diabetes.

The over-prescribing of drugs has been identified as a major concern by regulators and insurers.

"Those shopping bags you see full of drugs are an issue," says Mr AbuRaddaha, highlighting the danger posed by medicines, which may be harmless when used on their own but can be deadly in combination with others.

"My worry is that if a drug to drug interaction occurs the outcome is death, disability or loss of productivity days."

The surging cost of health care in the capital coincides with unprecedented investment in the sector with the arrival of the Cleveland Clinic next year and several smaller hospitals and clinics under construction.

But as insurance premiums spiral out of control, their services may be restricted to patients who benefit from a dwindling number of high end policies.

For the rest of the population, the menu of medical services covered by their insurers is unlikely to improve until savings are found elsewhere.

"You can have a good restaurant but what good is it if nobody can afford to eat there?" says Dr Al Madi.

UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
Milestones on the road to union

1970

October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar. 

December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.

1971

March 1:  Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.

July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.

July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.

August 6:  The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.

August 15: Bahrain becomes independent.

September 3: Qatar becomes independent.

November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.

November 29:  At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.

November 30: Despite  a power sharing agreement, Tehran takes full control of Abu Musa. 

November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties

December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.

December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.

December 9: UAE joins the United Nations.

How do Sim card scams work?

Sim swap frauds are a form of identity theft.

They involve criminals conning mobile phone operators into issuing them with replacement Sim cards by claiming to be the victim, often pretending their phone has been lost or stolen in order to secure a new Sim.

They use the victim's personal details - obtained through criminal methods - to convince such companies of their identity.

The criminal can then access any online service that requires security codes to be sent to a user's mobile phone, such as banking services.

Dengue fever symptoms
  • High fever
  • Intense pain behind your eyes
  • Severe headache
  • Muscle and joint pains
  • Nausea
  • Vomiting
  • Swollen glands
  • Rash

If symptoms occur, they usually last for two-seven days

Essentials

The flights
Emirates, Etihad and Malaysia Airlines all fly direct from the UAE to Kuala Lumpur and on to Penang from about Dh2,300 return, including taxes. 
 

Where to stay
In Kuala Lumpur, Element is a recently opened, futuristic hotel high up in a Norman Foster-designed skyscraper. Rooms cost from Dh400 per night, including taxes. Hotel Stripes, also in KL, is a great value design hotel, with an infinity rooftop pool. Rooms cost from Dh310, including taxes. 


In Penang, Ren i Tang is a boutique b&b in what was once an ancient Chinese Medicine Hall in the centre of Little India. Rooms cost from Dh220, including taxes.
23 Love Lane in Penang is a luxury boutique heritage hotel in a converted mansion, with private tropical gardens. Rooms cost from Dh400, including taxes. 
In Langkawi, Temple Tree is a unique architectural villa hotel consisting of antique houses from all across Malaysia. Rooms cost from Dh350, including taxes.

COMPANY PROFILE

Company name: Klipit

Started: 2022

Founders: Venkat Reddy, Mohammed Al Bulooki, Bilal Merchant, Asif Ahmed, Ovais Merchant

Based: Dubai, UAE

Industry: Digital receipts, finance, blockchain

Funding: $4 million

Investors: Privately/self-funded

The bio

Date of Birth: April 25, 1993
Place of Birth: Dubai, UAE
Marital Status: Single
School: Al Sufouh in Jumeirah, Dubai
University: Emirates Airline National Cadet Programme and Hamdan University
Job Title: Pilot, First Officer
Number of hours flying in a Boeing 777: 1,200
Number of flights: Approximately 300
Hobbies: Exercising
Nicest destination: Milan, New Zealand, Seattle for shopping
Least nice destination: Kabul, but someone has to do it. It’s not scary but at least you can tick the box that you’ve been
Favourite place to visit: Dubai, there’s no place like home

WORLD RECORD FEES FOR GOALKEEPERS

1) Kepa Arrizabalaga, Athletic Bilbao to Chelsea (£72m)

2) Alisson, Roma to Liverpool (£67m)

3) Ederson, Benfica to Manchester City (£35m)

4) Gianluigi Buffon, Parma to Juventus (£33m)

5) Angelo Peruzzi, Inter Milan to Lazio (£15.7m

MATCH INFO

Uefa Champions League semi-finals, first leg
Liverpool v Roma

When: April 24, 10.45pm kick-off (UAE)
Where: Anfield, Liverpool
Live: BeIN Sports HD
Second leg: May 2, Stadio Olimpico, Rome

Company Profile

Name: HyveGeo
Started: 2023
Founders: Abdulaziz bin Redha, Dr Samsurin Welch, Eva Morales and Dr Harjit Singh
Based: Cambridge and Dubai
Number of employees: 8
Industry: Sustainability & Environment
Funding: $200,000 plus undisclosed grant
Investors: Venture capital and government

A QUIET PLACE

Starring: Lupita Nyong'o, Joseph Quinn, Djimon Hounsou

Director: Michael Sarnoski

Rating: 4/5

Kill

Director: Nikhil Nagesh Bhat

Starring: Lakshya, Tanya Maniktala, Ashish Vidyarthi, Harsh Chhaya, Raghav Juyal

Rating: 4.5/5

MATCH INFO

Jersey 147 (20 overs) 

UAE 112 (19.2 overs)

Jersey win by 35 runs

The specs

Engine: Single front-axle electric motor
Power: 218hp
Torque: 330Nm
Transmission: Single-speed automatic
Max touring range: 402km (claimed)
Price: From Dh215,000 (estimate)
On sale: September

COMPANY PROFILE

Company name: Revibe
Started: 2022
Founders: Hamza Iraqui and Abdessamad Ben Zakour
Based: UAE
Industry: Refurbished electronics
Funds raised so far: $10m
Investors: Flat6Labs, Resonance and various others