Dubai Shelves Mandatory Health Insurance Scheme

Posted on Oct 06, 2011 by Sergio Ulloa (G+)

Dubai's upcoming national health insurance system, designed to cover every employee in the Emirate, has been delayed for at least two years. Those who have found themselves priced out of private health insurance policies now face a longer wait for treatment options. The Dubai Health Authority (DHA) announced on Tuesday that they had officially postponed the implementation of compulsory health insurance requirements for local employers for two more years. In Dubai at present, there are some private sector employers that provide insurance for their staff or negotiate directly with hospitals over treatment plans, but many workers are still left without insurance and struggle with medical costs. The new insurance system, which would make healthcare a required benefit for every worker in the Emirate, has been in development for quite a while. Laila Al Jassmi, DHA chief executive of health policy and strategy, told local media that moving the start date for national health insurance requirements in Dubai was made necessary due to the structural and economic challenges now facing the local labour market. "We have the models. But what we need to do is revise the model towards the existing status of the people and businesses in Dubai," Laila Al Jassmi told the National, adding that "If you look at the emirate now, most of the private sector provides some kind of health insurance coverage. However the blue-collar workers are a major segment who is mostly not covered. The new policy will be a complete policy that will cover everyone." The growing number of uninsured residents has become a significant issue in Dubai, particularly amongst the emirate's sizeable expatriate workforce. According to the most recent Dubai Household Health survey, around three-quarters of all Indian, Asian and Arab expatriates had no health insurance cover in 2010. This issue has been further exacerbated by the rising costs of public healthcare. Dubai residents who do not have employee-sponsored private coverage can apply for health cards that are supposed to grant them access to public health facilities at a discounted rate. However, with the rising costs of treatment, those health cards effectively offer no discounts now. Treatment costs in government hospitals have risen to roughly the same as those of private hospitals, with a consultation costing between Dh250 to Dh400 (US$75 to US$120), and a one night stay in the Intensive Care Unit costing around Dh3100 (US$845). Many uninsured workers struggle with these medical bills and thus often skip vital consultations and medical treatment until it's too late. Maintaining affordable access to necessary services like healthcare remains an issue for many expatriates in Dubai. The DHA's original plan called for a tax on local businesses that chose not to cover their staff with a private health insurance policy. The law would require that employers pay the Dubai government between Dh500 (US$136) and Dh800 (US$218) a year per employee. These employees would then be made register with a licensed outpatient clinic and become eligible for basic healthcare services. Since 2005, Abu Dhabi has had a similar law in place, and this has helped the emirate cover around 98 percent of its workers. The Abu Dhabi Health Insurance Law states that active employers or sponsors in the Emirate must provide some form of health insurance for job-related illness to employees and their family members. This includes cover for an employee's spouse as well as insurance for up three children aged 18 or lower as long as they are in the Emirate. Since last year, those failing to comply with the ruling would be subject to a fine of at least Dh300 (US$82) per employee per month. It must be said however that proper enforcement for Abu Dhabi's policy was only introduced in the past week. Dubai's compulsory health insurance scheme was originally scheduled to come into effect in January 2009 but the aftermath of the global financial crisis on Dubai's private sector and property market necessitated a delay. After the financial crisis, some multinational companies decided to pare down their employee cover, while others began to share premium costs with the employees. Labor costs may have to adjust further so that employers can afford to adequately pay and give benefits to their staff.The official deadline for the introduction of compulsory health insurance is now 2013. Moving the launch date for the health insurance scheme back a couple years puts it in line with the government's 2011-2013 three-year plan, which includes several other initiatives tasked with improving the Emirate's healthcare system. Among them is a national strategy to improve healthcare funding. To accomplish this, the DHA is developing a National Health Account that will monitor Dubai's overall healthcare expenditure and compare them to investment priorities in the other Emirates. According to the World Health Organization (WHO), the UAE as a collective spends 2.5 per cent of its GDP on healthcare. Comparatively, this is much lower than many Western countries. However, since the UAE is a tax-free country, as healthcare costs rise they become more difficult for the government to carry entirely on their own. The National Health Account is also designed to support greater private sector development in the local healthcare industry. Public healthcare facilities in Dubai currently account for 39 percent of all outpatient services, with the rest provided by the private sector. The DHA wants the number and quality of private hospitals and clinics in Dubai to expand further and lift the burden off the public treasury. This will be necessary to not only maintain a sustainable national healthcare system but also to give impetus towards growing the local medical tourism industry. In addition to healthcare budgeting and insurance reform, the Dubai government's three-year plan calls for an improved national medical information database, taking advantage of modern mobile network technology to guarantee transparent business practices. The DHA believes the public will be better served if they have access to data which adequately compares service quality and productivity of local hospitals. The Emirate also has plans to train and retain a high quality medical workforce through an improved screening process over education and credentials, in addition to funding continuous education programs, which will keep staff up to date with the latest advances in international medicine. Organization Mentioned Dubai Health Authority The Dubai Health Authority (DHA) is a government organization tasked with overseeing the healthcare sector of the Emirate of Dubai. The DHA was created in 2007 under the directive of Sheikh Mohammed bin Rashid Al Maktoum, the Vice President, Prime Minister, and Ruler of Dubai. Medical care services throughout Dubai can be provided through DHA medical facilities including hospitals (Al Wasl, Dubai and Rashid), specialty centers (The Joslin Diabetes Center) and numerous primary health centers.