The health insurance landscape across the GCC continues to evolve with numerous regulatory changes in recent months impacting the health insurance market in Saudi Arabia and the United Arab Emirates and with further changes anticipated for the market in Qatar, Bahrain and Kuwait. It is important for health insurance participants in the region to stay abreast of the changes, many of which could significantly impact the market. We set out below a high level overview of the regulatory developments followed by a more detailed look at each of the regulatory changes.
Overview of regional developments
In Saudi Arabia, the Council of Cooperative Health Insurance (CCHI) has issued a 'Unified Policy' which sets out rules relating to the issue of mandatory health insurance policies. The Unified Policy is intended to tighten the procedures to ensure that Saudi nationals working in the private sector receive the mandated healthcare services and to combat the use of 'dummy' health insurance policies. The aim is to ensure that all private sector employees are covered by private insurance and to reduce the burden on the public system. The CCHI has also introduced compulsory health insurance for visitors and tied it into Enjaz (the Saudi online visa application system) for effective implementation.
In the United Arab Emirates, the Health Authority of Abu Dhabi (HAAD) announced cuts to the coverage provided under the Thiqa (coverage for nationals) and the Abu Dhabi Basic Plan effective 1 July 2016. These changes signal an attempt to relieve pressure on the public purse and illustrate the ongoing challenge of implementing economically sustainable schemes.
In Dubai, the final stage of the compulsory health insurance regime was implemented on 30 June 2016 and the Dubai Health Authority (DHA) confirmed a "supportive" rather than punitive approach to enforcement, for the time being. The DHA issued a Circular on 19 June 2016 with new approval requirements for the marketing and advertising of health insurance products.
A new compulsory health insurance law is anticipated for Qatar, but no law has been issued to date.
According to media reports Kuwait is planning to introduce compulsory health insurance for visitors before the end of 2016, the reports also suggest that the government has plans to restrict their expatriate population's access to the public health sector. And media reports state that the government of Bahrain is aiming to roll out a health funding scheme by 2019.
The CCHI published in Arabic a 'Unified Health Insurance Policy' (Unified Policy) for private sector employers on the CCHI website. According to the Unified Policy published on 10 July 2016, the policy was approved by a Cabinet Decision No. 103 on 14 April 2016 and is to be implemented in four stages. As far as we are aware, no legislation has been published in the Official Gazette or otherwise been made publicly available to date.
There are a reported 1.2 million Saudi nationals working in the private health sector effectively not covered by private sector health insurance. The objective of the Unified Policy is to further implement existing compulsory medical insurance requirements and close existing loopholes to ensure that all of the Saudi nationals working in the private sector are covered by private health insurance.
The Unified Policy is being implemented in phases based on the number of employees. Stage 1 was implemented on 10 July 2016 (employers with +100 employees) and Stage 2 on 10 October 2016 (for employers with between 50-99 employees: The remaining two implementation stages are:
- Stage 3 employers with between 25-49 employees on 10 January 2017;
- Stage 4 employers with less than 25 employees 10 April 2017.
Compulsory health insurance for visitors
A Cabinet Decision was introduced in 2014 approving the introduction of compulsory medical insurance for all visitors to Saudi Arabia (subject to certain exemptions such as medical tourists, pilgrims and diplomats). CCHI issued in Arabic a Visitors' Policy with a Schedule of Benefits in 2015. On 20 June 2016 the requirements were finally implemented requiring applicants for visit visas to obtain local health insurance. Foreign travel insurance is not sufficient to meet the new requirements. The compulsory cover is intended to cover medical emergencies should they arise while visiting Saudi Arabia. The process for obtaining the compulsory local health insurance has been integrated into the online visa application system (Enjaz), with the selection of health insurance being offered, selected and paid for through Enjaz, along with the purchase of the visit visa.
Emirate of Abu Dhabi - Thiqa
HAAD announced cuts to its two main health insurance programs, Thiqa and the Abu Dhabi Basic Plan. HAAD have announced that the changes came into effect on 1 July 2016. However, the revised regulations underpinning the changes are not yet publically available.
Thiqa is the health insurance cover provided to Emiratis in Abu Dhabi. The changes to the Thiqa plan are:
- Cardholders will receive 80% coverage of fees for treatment at private hospitals; they will continue to receive 100% coverage for treatment at Government hospitals;
- Cardholders will receive 50% coverage of fees for treatment 'abroad' (the term abroad refers to treatment outside the Emirate of Abu Dhabi and this includes other Emirates) unless the treatment is unavailable in Abu Dhabi in which case they will receive 100% coverage;
- Changes have also been made to coverage for 'non-essential' treatments such as orthodontic braces for adults and IVF treatment.
- All prescriptions from private healthcare facilities will only be dispensed at private pharmacies.
Emirate of Abu Dhabi – Abu Dhabi Basic Plan
The Abu Dhabi Basic Plan (Basic Plan) is available for expatriate workers with a visa in Abu Dhabi who earns AED 5,000 per month or less. It was, prior to this, also available for spouses or dependants that were not included in the mandated employer coverage. The changes to the Abu Dhabi Plan are:
- Workers on the Basic Plan over 40 years of age could now be required to pay 50% of their own premium if required to do so by their employer;
- All employees are obliged to pay 50% of the premium for their dependants' coverage (wife and up to three children).The costs for other dependants such as father, mother and fourth child are to borne in full by the individual employee.
- Childbirth costs will be charged according to a separate scheme.
The annual premium for the Basic Policy has increased from AED 600 to AED 800 for expatriate employee between the ages of 18 to 59, AED 5,500 for employees age 60 or above. Additionally, there is a mandatory surcharge for married females between the ages of 18 to 50 of AED 750.
These changes signal an attempt to relieve pressure on the public purse. The changes will inevitably have a knock-on effect across the healthcare sector. Media reports highlight questions around the public sectors' capacity to cope with the increased demand and private sector ability in turn to absorb the impact of a downturn in demand for private treatment. These changes highlight a more general systemic risk associated with healthcare financing and the ongoing challenges of implementing economically sustainable schemes.
Emirate of Dubai
The final stage of the Dubai's compulsory health insurance scheme was implemented 30 June 2016, extending the compulsory health insurance requirements to all remaining workers (including domestic staff) and spouses and dependants. All citizens and residents of Dubai should now have access to a mandated level of healthcare.
On 19 June 2016, the DHA issued:
- Circular No. 2 of 2016 in response to reports that members with special needs were being denied health insurance coverage, to remind market participants of their obligation to provide health insurance for persons with special needs; and
- Circular No. 3 of 2016 in response to DHA concerns in relation to certain marketing practices, to require all marketing of health insurance product in whatever medium to be approved by the DHA prior to undertaking the marketing or advertising.According to the DHA, the review and approval process has a turnaround time of no more than 2 working days.
On 23 June, in response to market confusion arising out of media reports and marketing activities of certain health insurance providers, the DHA issued Circular No. 4 of 2016 to clarify:
- that the mandatory health insurance deadline of 30 June was to be implemented;
- who is responsible for paying for coverage for different categories of citizens and residents namely:
- Private sector employers fortheir national employees;
- Enaya for national government employees;
- SAADA scheme for retired or unemployed nationals;
- Employer for employed residents;
- Sponsor for spouses and dependants; and
- Employer for domestic staff, whether sponsor is national or resident.
- the DHA's supportive rather than punitive approach to imposing fines and penalties for breaches to allow time to comply with the requirements.
Circular 5 of 2016 was issued on 23 of August to notify the market of the 136 health insurance intermediaries that have unconditional compliance status and are permitted to operate in Dubai.
Circular No 6 of 2016 was issued on 25 August to remind the market of the obligation to complete the Members Register on the e-Claims Link, the penalty for non-compliant and the implication for visa renewals for employees.
Qatar, Bahrain, Kuwait
An announcement is still awaited from the Qatar Ministry of Public health on the new mandatory health insurance law.
There are media reports and market rumours that indicate that Bahrain is aiming to roll out a health funding scheme by 2019.
Kuwait’s parliamentary Health Committee has reportedly approved a draft bill requiring foreigners who visit the country to obtain health insurance prior to receiving an entry visa.
Media reports also indicate that the Kuwait Ministry of Health has approved a scheme to provide medical insurance and healthcare for non-nationals who live in Kuwait. The move follows a decision by the Kuwaiti government to ban foreigners from access to public healthcare services. The restriction is expected to be implemented in two years' time, at which point reports suggest that expatriates in the private sector will be required to purchase a health insurance policy to access to medical services at specific private hospitals. The exact mechanism for providing them with health insurance coverage has not yet been clarified, but it is expected that individuals and/or employers will be expected to cover the costs.
Key to managing regulatory risk within international and regional health sector business is staying abreast of regulatory developments. This remains a challenge as the GCC's health insurance landscape continues to evolve, with regulatory frameworks and developments varying from jurisdiction to jurisdiction. In addition, the implementation of health insurance schemes across the GCC will encourage growth in the health insurance sector across the region. However, health insurance businesses will need time to plan for the potential growth and the impact to the market and their regional distribution models.