Medical inflation dramatically outstrips general inflation in UAE and is a serious burden on employers
84% of public underestimate medical inflation, with half also unaware of their own healthcare insurance costs
Word of mouth an important influence on individuals' choices of doctors and hospitals, with most eager but unable to access specialised independent information about healthcare quality or price
Dubai, 26 April 2016: New research commissioned by International SOS has shown that 84% of people living in the United Arab Emirates underestimate the country's high level of medical inflation, an increasingly serious concern to employers as a growing proportion of the total cost of employment.
The research was conducted by the global research firm YouGov. International SOS is the world's leading medical and travel security risk services company, helping companies meet their Duty of Care to expatriates and business travellers worldwide.
Medical inflation in the UAE was 9.5% in 2015 according to Pacific Prime, a global health insurance broker that conducts annual studies of costs worldwide. Medical inflation in the UAE has averaged 10% in the past five years.
This means that a company's health insurance policies which cost AED1 million in 2010 rose to cost AED1.6 million by the end of last year.
Overall inflation in the UAE economy is much lower - 2.5% last year and 2.3% in 2014 according to the National Bureau of Statistics.
Many employers in the UAE are obliged to pay for health insurance directly. Some 51% of people say that they do not know how much their health insurance costs.
However, under most plans individuals can choose which doctors, clinics and hospitals to use, sometimes from a list set by their insurer. When they have a concern, few have access to independent medical advice on which healthcare provider to use or even whether a doctor visit is required at all.
Costs vary significantly between institutions for the same healthcare services in the UAE, even when quality is comparable. International SOS assessments show that this variance for the same service at the same quality can be up to 70%.
As examples, fees at two leading hospitals in Dubai, which are comparable in terms of quality, vary as follows for these standard services:
- GP consultation: Hospital 1 (H1) is 70% more expensive than Hospital 2 (H2)
- Consultation with cardiac specialist: H1 is 25% more expensive than H2
- Normal delivery: H1 is 9% cheaper than H2
- Angiogram: H1 is 2% cheaper than H2
Further complicating the situation, between these two institutions, no single hospital is the most expensive across the board. For example, the institution with a 70% higher cost for a GP consultation has a 9% cheaper cost for a normal delivery.
Word of mouth and previous experience are the most significant factors in how individuals choose healthcare providers, with 66% and 56% citing them. However, demand for medical staff leads to high personnel turnover and service gaps. Some 20 new hospitals are expected to be built in the UAE over the next few years, in part driven by growing medical tourism to the country.
Many healthcare institutions are stronger in some medical specialisations than others, according to International SOS, which is led by 1,400 doctors and conducts assessments of healthcare providers worldwide.
Dr Fraser Lamond, Regional Medical Director at International SOS, said: "Just because a hospital looks fantastic and has shiny equipment does not mean that health outcomes for patients will be the best. However, it does often mean that treatment costs can be sky high. There is a real need to understand the quality and reliability of the healthcare itself first when selecting healthcare providers. That will lead to better outcomes for patients and lower costs for society."
Three-quarters of people in the UAE say that they would use an independent telephone service staffed by qualified experts who could provide initial advice on a medical concern and direct them to the most appropriate healthcare provider.
International SOS runs a network of 27 assistance centres worldwide, led by medical doctors, including an assistance centre in Dubai.
Some 59% of respondents have visited the doctor at least twice over the past year, with over a quarter reporting more than four visits.
Des Donnelly, Corporate Development Director at International SOS, said: "Rising healthcare costs concern everybody. Healthcare inflation threatens our job prospects, pay-rises and bonuses. Unfortunately, few people seem aware of this, and those that are have little information to manage their own impact on this issue.
"The lack of initial medical advice and referrals to an audited network of clinics and hospitals drives up the number and cost of medical treatment claims for insurance companies, and this inflates employers' premiums year after year. It would be in everybody's interest to take action to address this."
In Dubai, from 30 June, all employers will be required to pay for health insurance for their employees, including those employing domestic staff. Employers of fewer than 100 people were previously exempt.
About International SOS
International SOS is the world's leading medical and travel security risk services company. We care for clients across the globe, from more than 850 locations in 92 countries.
Our expertise is unique: More than 11,000 employees are led by 1,400 doctors and 200 security specialists. Teams work night and day to protect our members.
We pioneer a range of preventive programmes strengthened by our in-country expertise. We deliver unrivalled emergency assistance during critical illness, accident or civil unrest.
We are passionate about helping clients put Duty of Care into practice. With us, multinational corporate clients, governments and NGOs can mitigate risks for their people working remotely or overseas.
Media contact
Eman El Ahmar
eman.elahmar@bluerubicon.com
+971 55 123 5591
© Press Release 2016
