The danger of expanding private health insurance



Abdurrahman Al-Sultan

Published — Thursday 15 November 2012

Last update 15 November 2012 12:41 pm

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The biggest drawback of expanding private health insurance is the increased cost of health services. It will leave a significant percentage of the population without health coverage, just like in the United States. The call to expand health insurance comes as many developed countries manage to provide overall health services to their citizens at a minimal expense. This is due to the fair and efficient means they adopt.
Besides, the current expansion of health insurance clearly shows our failure to see the impact of such a move.
First, the talk about privatizing public hospitals and issuing insurance cards for each national who isn’t covered by his work is simply illogical. It poses a great danger to the health system and is unjustified when we already know of successful international practices in health service management.
This idea will severely increase the cost of financing the health services and add an additional burden on the Ministry of Health’s budget and the budget of other departments providing health services.
The fact that only 681,481 of 11.7 million Saudis are employed by the private sector (5.8 percent) means the state will be responsible to provide medical insurance to more than 90 percent of Saudis. The cost to purchase medical insurance for each Saudi not working in the private sector is higher than the current spending on health services.
Government spending on health is considered the lowest when compared not only to developed countries, but also to GCC countries. There is an endemic problem in the Kingdom that prevents delivery of health services to nationals. Government spending on health in 2006 was less than 3.3 percent of the GDP, whereas Canada spends 10 percent and Australia 8.7 percent of GDP. The individual’s share of government health spending is the lowest among the GCC countries except for Oman, which spends $ 379 a year. Compare that to Britain that spends $ 2,908 and $ 2,759 in Canada.
If the Ministry of Health abandons its government-sponsored delivery of health services for privatization and fails to deliver health insurance to everyone as it promises, the majority of Saudi society will be left without any kind of health coverage. That will have adverse consequences.
Privatization of health services is not a good idea especially when you see developed countries that appreciate free markets elected not to do it. They kept public hospitals and public health insurance. In Australia, for instance, 75 percent of hospitals are public. In Canada, only 5 percent of hospitals are private and they are non-profit organizations. The health services of these two countries are among the most efficient and effective health systems in the world.
Privatizing the health sector is not welcomed and it is strange when people think it would solve any problem. Poor services pushed the country once to cancel its hospital operation contracts and it chose to operated them directly.
We will make a big mistake if we expand private health insurance when there are plenty of options that have proved successful around the world.

— Courtesy of Al Jazeerah newspaper

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