Saudi hospitals need 7,500 new beds by 2022: Alpen Capital

Saudi Arabia will have to add over 7,500 new beds, the largest requirement among the Gulf nations, as the number of patients swell by 2022, Alpen Capital's said in its recent GCC Healthcare Industry report.

"In view of the anticipated rise in the number of patients, the GCC may require a collective bed capacity of 118,295 by 2022, indicating a demand for 12,358 new beds," it added.

The United Arab Emirates will follow Saudi Arabia in new bed requirement, having to add more than 2,000.

Meanwhile, current healthcare expenditure in the GCC is expected to reach $104.6 billion in 2022 from an estimated $76.1 billion in 2017, implying a CAGR of 6.6 percent.

According to Alep Capital, major factors driving healthcare growth in the region include population growth from 6.6 million to 61.2 million by 2022, high prevalence of non-communicable diseases (NCDs), rising cost of treatment, and increasing penetration of health insurance.

Expenditure on outpatient services is predicted to grow at an annualized average rate of 7.4 percent to $32 billion. In comparison, inpatient services will see an anticipated CAGR of 6.9 percent to $45.4 billion.

However, the inpatient market will remain the largest segment with a contribution of 43.4 percent in 2022.  

Meanwhile, the annual average growth rates of healthcare expenditure in the GCC countries are projected to range between 2.6 percent and 9.6 percent during the forecast period, the report said.

Saudi Arabia and the UAE will continue to dominate the sector with a combined share of over 80 percent of healthcare expenditure in 2022.

"Private healthcare in the Middle East is witnessing a phase of major growth,” Makarem Batterjee, vice chairman of the Saudi German Hospitals Group, said in a note published in the report.

The sector is expected to see an increasing number of public-private partnerships, he said, adding that new hospital infrastructure can grow more rapidly if governments provide "soft funding support" for healthcare infrastructure projects.

However, Alpen Capital noted that a low-price oil environment could constrain expansion of the healthcare sector, which also continues to face a shortage of skilled manpower, rising gross medical inflation rates, and lack of technology to treat serious ailments.

This, in turn, leads patients in the region to seek treatment in foreign countries, the report said.