Health Care Finance in Saudi Arabia - Assignment Example

Health Care Finance in Saudi Arabia Government Efforts to Find other Sources for Budget Allocations to Spend on the Health Sector The government is advocating for the initiation of multiple financial sources through the Cooperative Health Insurance program. This is coupled with the compulsory insurance scheme for the employed under a system called Compulsory Employment-Based Health Insurance. Such schemes have made the insurance sector a major per taker in the financial matters relating to the health sector. A number of expenses that would have been the government’s responsibility are covered by the insurance sector. Therefore, insurance schemes are one of the alternatives used to finance the health sector. The role of civil charities in Saudi Arabia is being enhanced by the enhanced by the government. The civil charity programs contribute extensively in enhancing and financing health activities especially in the marginalized areas in the country. Therefore, the government’s finance to the health faculty is complemented by finances from civil charity organizations. The health-related organizations under the UN play a major role in the extension of financial health through civil charity programs. Therefore, is initiating charity programs in conjunction with organizations that are willing to extend financial assistance to the country’s health sector. Ministerial committees are being set up and some are already in place and their role is to enhance the coordination of the various sectors within the health system. The committees have been advocating for collaboration among the sectors on health matters, financial issues being one of them. The collaboration is mainly advocated for at the subnational level because local governments are in need of an extra source of finance. In this regard, the role of stakeholders such as the King Faisal Hospital and Research centre is being integrated into the health sector. The stakeholders can provide financial resources in support of the health system and also carry out research expeditions in order to find other ways of financing health. The government is carrying out a consistent and careful evaluation of the indicators for health expenditure. The analysis of the indicators gives the government a scope of the financial situation in the health institutions within the country. Therefore, the analysis gives the government a platform on which adequate financial planning can be done. For instance, in 2010, 82.9 percent of the total expenditure on health is accounted for by the country’s health care system. From analysis, these financial statistics are expected to rise by an estimated average of at least 10 percent annually between 2012 and 2016. Such financial projections enable the government to plan prior to the rise of financial needs (Oxford Business Group, 2013, p. 269). The government has established a body called the Saudi Arabia Investment Authority. The body regulates investments from foreign sources and issues licenses to investors. The investors channel funds to the government which in turn invests some of the funds in the health sector. The government attracts the government by use of viable and attractive incentives and guarantees. Some investors invest directly in the health sector for example through the establishment of private health institutions (Alamri & Zuraikat, 2011, p. 54). The government is also carrying out the pooling of healthcare revenues. The pooling of the revenues ensures that some of the finances obtained from the provision of healthcare services are further invested into the health sector. However, the revenue obtained by healthcare facilities is dependent on the existence of a balance between demand and supply in the health sector. The government therefore strives to develop more healthcare facilities to meet the ever rising demand for healthcare services. Once the demand is met, the balance is maintained thus ensuring consistency in the healthcare revenue being obtained The government is advocating for the application of direct out-of-pocket payments. In such a system, individuals directly pay for healthcare services or invest into the health sector. Such payments can cater for the running costs in health facilities and subsequently medical activities will run without interruptions. The out-of-pocket payments can complement the taxation system whereby funds are deducted from individuals’ personal income. Such payments constitute the private expenditure on health and are distinct from the public expenditure that is the responsibility of the government. Community financing is another budgetary source for the health sector in Saudi Arabia. This is based on the collective responsibility of the local community in the country providing funds for healthcare service provision. Therefore, the community can complement the government efforts aimed at financing healthcare by extending financial assistance to the local health facilities. Collective responsibility eliminates the misconception held by the public that the process of financing healthcare services is solely the government’s responsibility. The legislature in Saudi Arabia has been formulating laws that would govern the relationship of major partners and the health sector. Such include the World Health Organization and UNICEF. Partners are useful in financing various health programmes. The government can work in conjunction with such partners to adequately finance the activities and projects related to the health sector in the country. Challenges within the Health Sector The Ministry of Health is encompassed by a lot of bureaucratic practices that have been a hindrance to proper provision of finances to the health sector. Bureaucracy creates complications in the funding system and results into less funds being delivered to the health institutions. It is characterized by an unfair method of remitting funds since the government exercises full control on this without involving the private sector. Inadequate finances have adverse effects on the quality of management since it makes the running of health institutions less efficient. The solution to this challenge is the decentralization of healthcare financial systems such that the provision of finances to health centres in the country is simplified making it efficient and effective. The government has made efforts to advance and diversify the health sector but has not put the number of health staff available in the country. For this reason, the health sector is faced with a shortage of qualified personnel. The demand for health services has been rising to levels that the available workforce cannot adequately support. The Saudi Arabian government is advancing efforts to increase the number of healthcare workers. The government is establishing more medical schools that generate qualified personnel fir the health sector after effective training. Foreign health workers are also being encouraged to work in the country through attractive health incentives (Fielden, 2012, p. 30). Medical students are also receiving sponsorship from the government and this enables them to go and study abroad thus increasing the competency of the workforce as a result of the exposure of medical students in the medical faculty (Aldossary, While, & Barriball, 2008, p. 127). The health sector does not have an efficient health information system. This problem has made it difficult to deliver managerial duties such as decision making. The projection and analysis of health indicators has also been inefficient because of the lack of an appropriate system to store and process bulky information. The government is trying to solve this problem by improving the telecommunication systems in the country. The level of information technology in the health sector is also being raised. The efforts will in the long run improve the efficiency and quality of healthcare management. The health sector is facing financial management problems because proper managerial operating systems have not been put in place. The result of this deficiency is poor management of health institutions because the chief health officials are not working on the basis of well stipulated managerial protocols. Therefore, the protocols and essential managerial operating systems should be put in place. The inefficient management system further leads to inappropriate allocation and use of healthcare funds. The solution here is the introduction of proper procedure in the process of allocation of budgets to serve different healthcare needs thus ensuring proper financial management. The Saudi Arabian health sector is having difficulties in handling the ever increasing prevalence and incidence rates of various diseases. Examples of such diseases include diabetes and heart-related infections. The management of the chronic diseases has been inefficient and this has been the main reason for the increasing disease prevalence in the country. The government is investing funds in the establishment of more financial facilities with appropriate equipment for providing treatment for patients suffering from the extensive infections. The investment is aimed at countering the spread of diseases and in this way reducing the prevalence of the diseases in question (Watson, Preedy, & Zibadi, 2013, p. 119). Another notable challenge is the population explosion in Saudi Arabia. The population in the country is growing at the rate of 2.2 percent and this is straining the available health institutions because they cannot adequately cater for the healthcare needs of the whole population. However, the government has initiated investment programs that have led to the establishment of new health institutions and the general expansion of the health sector. Therefore, the improved and extensive healthcare system can cater for the rising population in the country (Zuhur, 2011, p. 405). The activities of the country’s health sector are proving to be expensive. It is generally expensive for the government to effectively facilitate the provision of healthcare services. For instance, the use of energy and water in health facilities is uneconomical and expensive. Efforts are being made by the government to sensitize the practitioners in the health sector on the importance of rationalizing the use of resources like water and energy. The rationed use of such resources prevents the government from incurring extensive costs in the process of running the public health sector. The Saudi government has had an imbalanced budgetary system that has led to overspending on the purchase of medical appliances and medicine. The building of more health facilities has also taken up a large part of the national budgetary allocation. In this regard, the government is developing mechanisms for effective control and monitoring of the production and importation of medical implements and medicine. Monitoring these processes ensures that the government avoids overspending on the health sector thus enabling cost saving that avails funds to be invested elsewhere in the health sector (Ramady, 2010, p. 43). Investment in the provision of emergency healthcare services has not been efficient. Therefore, response to medical emergencies has not been efficient. Part of the funds invested into the health sector should fund emergency service provision. The allocation of funds in health emergency response agencies in turn improves the provision of emergency healthcare services. Oil is major export commodity in Saudi Arabia and constitutes a large percentage of the total revenue the country earns. The revenue obtained from the oil exportation is the main source of finances used to fund the health sector in the country. However, the price of oil in the international market is not consistent and this causes inconsistency in the provision of funds to the health sector. The solution to this problem would be pushing for the establishment of an equilibrium and consistent price in the oil market. Bibliography Alamri, M, & Zuraikat, N. (2011). Financial Incentives System for Nursing in the Kingdom of Saudi Arabia, Journal of Accounting & Finance (2158-3625), 11, 2, pp. 53-57, Business Source Complete, EBSCOhost, viewed 23 May 2015. Aldossary, A., While, A, & Barriball, L. (2008). Health care and nursing in Saudi Arabia, International Nursing Review, 55, 1, pp. 125-128, Academic Search Premier, EBSCOhost, viewed 23 May 2015. Fielden, JM. (2012). Managing the transition of Saudi new graduate nurses into clinical practice in the Kingdom of Saudi Arabia, Journal Of Nursing Management, 20, 1, pp. 28-37, Academic Search Premier, EBSCOhost, viewed 23 May 2015. Oxford Business Group. (2013). The Report: Saudi Arabia 2013. Oxford: Oxford Business Group Ramady, M. A. (2010). The Saudi Arabian economy. New York, Springer. Watson, R. R., Preedy, V. R., & Zibadi, S. (2013). Polyphenols in Human Health and Disease. Burlington, Elsevier Science.  Zuhur, S. (2011). Saudi Arabia. Santa Barbara, Calif, ABC-CLIO. Read More