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ORIGINAL RESEARCH ARTICLE

Healthcare Finance in the Kingdom of Saudi Arabia: A Qualitative Study of Householders’ Attitudes

Mohammed Khaled Al-Hanawi1,3 • Omar Alsharqi1 • Saja Almazrou2 •

Kirit Vaidya3

� The Author(s) 2017. This article is an open access publication

Abstract

Background The public sector healthcare system in Saudi

Arabia, essentially financed by oil revenues and ‘free at the

point of delivery’, is coming under increasing strain due to

escalating expenditure and an increasingly volatile oil

market and is likely to be unsustainable in the medium to

long term.

Objectives This study examines how satisfied the Saudi

people are with their public sector healthcare services and

assesses their willingness to contribute to financing the

system through a national health insurance scheme. The

study also examines public preferences and expectations of

a future national health insurance system.

Methods A total of 36 heads of households participated in

face-to-face audio-recorded semi-structured interviews.

The participants were purposefully selected based on dif-

ferent socio-economic and socio-demographic factors from

urban and rural areas to represent the geographical diver-

sity that would presumably influence individual views,

expectations, preferences and healthcare experiences.

Results The evidence showed some dissatisfaction with the

provision and quality of current public sector healthcare

services, including the availability of appointments, wait-

ing times and the availability of drugs. The households

indicated a willingness to contribute to a national insurance

scheme, conditional upon improvements in the quality of

public sector healthcare services. The results also revealed

a variety of preferences and expectations regarding the

proposed national health insurance scheme.

Conclusions Quality improvement is a key factor that

could motivate the Saudi people to contribute to financing

the healthcare system. A new authority, consisting of a

partnership between the public and private sectors under

government supervision, could represent an acceptable op-

tion for addressing the variation in public preferences.

Key Points for Decision Makers

Saudi people seek the best possible quality

healthcare and display strong feelings about certain

improvements.

Introducing a national health insurance system seems

to be a viable option to finance the Saudi healthcare

system.

Quality improvement is a key factor that could

motivate the Saudi people to contribute to financing

the healthcare system.

Electronic supplementary material The online version of this article (doi:10.1007/s40258-017-0353-7) contains supplementary material, which is available to authorized users.

& Mohammed Khaled Al-Hanawi [email protected]

1 Health Services and Hospitals Administration Department,

Faculty of Economics and Administration, King Abdulaziz

University, Jeddah, Saudi Arabia

2 Clinical Pharmacy Department, College of Pharmacy, King

Saud University, Riyadh, Saudi Arabia

3 Economics, Finance and Entrepreneurship Group, Aston

Business School, Aston University, Birmingham, UK

Appl Health Econ Health Policy

DOI 10.1007/s40258-017-0353-7

1 Introduction

The Kingdom of Saudi Arabia (KSA) is a high-income

developing country with a landmass of 2,149,690 km 2 and

a population of 31,742,308 [1]. It has experienced rapid

urbanization (in 2015, 83% of the total population was

urban). The vastness of the country impacts the accessi-

bility, quality and equity of healthcare service delivery.

Since the discovery of oil in the 1930s, the KSA’s nomadic

Bedouin tradition has been replaced by a modern lifestyle

similar to that of other highly developed countries. Oil-

derived wealth has funded free public sector services,

including healthcare, for all citizens, without collecting

taxes or contributions. Oil now accounts for over 90% of

the country’s exports and approximately 75% of govern-

ment revenues [2]; therefore, price fluctuations affect many

sectors, including healthcare. As an illustration, a decline

in oil prices caused a fall in gross domestic product (GDP)

per capita in Saudi Arabia from $US14,000 in 1980 to

$US7830 in 2002 [3].

Healthcare services are provided through the public

sector [including the Ministry of Health (MOH) and other

government agencies] and the private sector. The bulk of

healthcare service provision in the KSA is undertaken by

the public healthcare sector through the MOH. The MOH,

which is funded annually from the total government bud-

get, is the main provider of public healthcare services,

operating approximately 60% of hospitals and primary

healthcare centres. Recent years have witnessed an effort to

improve healthcare services, with a significant increase in

the allocated budget, ranging from 5.9% of the govern-

ment’s total budget in 2006 to 7.0% in 2014. Baranowski

[4] argued that the apparent success of the KSA healthcare

system can be attributed to this higher level of financing.

Despite the substantial resources that the government is

currently able to allocate to the healthcare system, the

system is increasingly under strain as a result of the most

pertinent challenges faced by publicly funded healthcare

systems, leading to rapid increases in expenditure and

demand while resources remain finite. These challenges

include rapid demographic changes, an ageing population,

an increase in sedentary lifestyles, rising costs, increasing

user expectations, and changing disease patterns [5]. The

present situation appears unsustainable in the medium to

long term, particularly in the face of uncertainties regard-

ing oil prices. The future viability and sustainability of the

current healthcare financing system has therefore been

questioned by both academics and international health

organizations [6–11].

To reduce the financial burden, the government has

implemented Compulsory Employment-Based Health

Insurance (CEBHI), which covers all private sector

employees and is paid by their employers. Some

researchers have suggested expanding this to cover all

citizens [12], whereas others have suggested introducing

user fees [13]. The government is also considering shifting

towards a national or social insurance-based system, which

could provide a potential solution to some of the country’s

current healthcare financing challenges.

Public involvement is believed to be vital to the success

of healthcare reforms and must be considered when

designing any healthcare financing system [14], but little is

known about public preferences and support for healthcare

reform in the KSA. According to Mooney [15], ‘‘what is

needed most fundamentally if healthcare systems are to

change and become more socially efficient and equitable is

to listen to the informed community voice and to act

accordingly’’. Considering the core issues is essential to the

design of a health finance or health insurance system, and

decisions about the level of public coverage and the design

of financing mechanisms must be made. This study there-

fore uses the framework developed by Kutzin [16] to

analyse the healthcare financing arrangement, as it assists

in understanding financing mechanisms and systems

(Fig. 1).

This study aims to explore the views of Saudi house-

holds with regard to their public sector healthcare system.

More specifically, the study aims to (1) explore household

views and satisfaction with public healthcare services, (2)

assess Saudis’ willingness to contribute to financing public

healthcare services through a national health insurance

scheme and (3) explore public preferences and expecta-

tions regarding the stewardship, dimensions of the cover-

age, and the healthcare financing functions of the national

health insurance scheme (revenue collection, pooling of

contributions, and the purchasing and provision of

services).

2 Methods

Qualitative semi-structured interviews were carried out to

collect information on the views of Saudi households. The

idea behind qualitative research is to purposefully select

participants that will best help the researcher understand

the problem and the research question [17]. There is a lack

of reliable population data at the household level in Saudi

Arabia. This lack precludes a fully representative sample.

Thus, to achieve as representative a sample as possible, a

varied sample of the participants was purposively selected

according to different social-economic class based on the

researcher’s knowledge of Saudi society, and chosen from

both urban and suburban areas, to represent the type of

geographical diversity that would influence opinions,

M. K. Al-Hanawi et al.

preferences, and experiences, revealing the broad spectrum

of participants’ personal views.

A sample of 36 heads of household was interviewed in

Jeddah, the country’s second-largest city, and its sur-

rounding areas, in the Jeddah province of the Mecca

region. The participants were selected from the outpatients

department of three public hospitals, two major urban

hospitals, and one suburban hospital: King Fahad Hospital,

King Abdulaziz Hospital, and Adham General Hospital.

The use of outpatients was important to identify the views

of those who were undergoing treatment and thus in a good

position to comment on problems experienced with public

healthcare provision. The sample was not intended to be

representative of the population as a whole but was

selected to develop a qualitative understanding of a varied

group of people. The sample size of 36 participants was

reached by the saturation of themes; that is, no new insights

were identified in the data [18]. These diverse character-

istics are illustrated in Table 1.

The interviews were conducted in Arabic over a period

of 1 month (September of 2014). The interviews were

conducted by the first author (MA). The semi-structured

interview guide (Online Appendix A) was developed on the

basis of a review of relevant literature on healthcare

financing in general and on the Saudi healthcare system in

particular. The review drew upon information from various

sources, including databases, reports from specialist orga-

nizations, books, workshop reports, and government doc-

uments. For the purposes of the study, and to ensure the

main topics were covered systematically, the interviews

were structured into five main sections.

The first section of the interview collected general

information about each participant’s household. The

questions were related to demographic and socio-economic

characteristics of the respondent and the household. The

second section was designed to find out the participants’

opinions of current public healthcare services in Saudi

Arabia. This section included questions on the advantages

and disadvantages of the system, participants’ level of

satisfaction, a comparison between healthcare services in

the public and private sectors, and the characteristics and

quality of public sector healthcare services.

The third section investigated participants’ opinions on

financing the public healthcare system. It included ques-

tions on their opinions on financial responsibility and who

should shoulder the healthcare financial burden and in what

circumstances. In the fourth section, data were collected on

participants’ experiences with private health insurance.

This section included questions on the advantages and

disadvantages of the current private health insurance

schemes, the level of satisfaction with these schemes, and

suggestions for improvements.

The final section was concerned with the feasibility and

acceptability of contributing to financing the public

healthcare system through a national health insurance

scheme to generate additional funds. This section included

questions on who should contribute financially if such a

scheme were put in place. It also included questions about

participants’ preferences and expectations with regard to

the stewardship of the national health insurance scheme,

the dimensions of the coverage and its financing functions.

The interviews were initiated by informing the partici-

pants of the study aim and objectives. Most participants

were familiar with the concept of health insurance, as it has

been a matter of debate in Saudi Arabia for some time.

However, clear explanations of different types of health

Fig. 1 Framework for the analysis of healthcare financing

arrangements, developed by

Kutzin [16]

Healthcare Finance in the Kingdom of Saudi Arabia

insurance were provided to participants (Online Appendix

B). The interviews took place in the waiting rooms of each

public hospital. The participants were informed that they

were free to withdraw at any time, without giving a reason,

and that all information and opinions provided would be

anonymous and confidential. Additional informed consent

was obtained from all individuals whose identifying

information is included in this article. The semi-structured

interviews lasted 30–60 min and were audio-recorded.

Most people invited to take part in the study accepted

(80%); none refused to allow the interview to be audio-

recorded.

The framework method for analysing qualitative data in

multi-disciplinary health research was used. This method

has been used since the 1980s; it originated in social policy

research and is now widely used in medical and health

research, including health economics and health policy

[19]. This method helps to identify commonalities and

differences in qualitative data for studies that aim to gather

specific information within a limited timeframe. It consists

of seven steps: transcription, familiarisation with the

interviews, coding, the development of a working analyti-

cal framework, the application of the analytical framework,

the charting of data onto a framework matrix, and the

interpretation of the data [20].

3 Results

3.1 Views on the Current Healthcare System

and Expressed Satisfaction

Overall, the main advantages and areas of satisfaction with

the current public healthcare system are the inclusiveness

of the healthcare service at all levels—primary, secondary

and tertiary—and the free provision to all Saudi citizens.

Many participants expressed this sense of certainty, char-

acterised by one participant who stated: ‘‘I know the sys-

tem is there for me whenever I need it. I know that there are

no conditions or payments attached to it, so I feel really

good and secure for myself and my family’’. An additional

advantage noted by a number of participants was a sense of

national, cultural and religious pride because the country

provides free healthcare services to all Muslims visiting the

country annually to perform Umrah and Hajj. This was a

view held by many of the participants and can be sum-

marised by one participant’s statement: ‘‘we are the guar-

dians of the Sacred Places and we show how seriously we

take this responsibility in the ways that we look after

Muslim believers’’.

The participants acknowledged the positive role of the

public healthcare system and its facilities, including general

hospitals, specialist hospitals and the ‘medical cities’ situ-

ated in the country’s major cities, which provide healthcare

services and treatments for a wide range of conditions. Of the

participants, 14 (39%) stated that public hospitals have

highly qualified physicians and medical personnel, as well as

modern medical equipment; 10 (28%) mentioned the ability

of public hospitals to provide a high standard of care and

showed satisfaction with treatment outcomes.

However, only half of the participants (50%) were

generally satisfied with the overall quality of services

provided by the public healthcare sector. The remaining 18

participants criticised the public healthcare service for

several reasons (Table 2).

Table 1 Main characteristics of study participants

Characteristics N %

Location (urban) 29 80.56

Sex (male) 31 86.11

Marital status

Single 3 8.33

Married 29 80.56

Divorced 3 8.33

Widowed 1 2.78

Age, years

18–24 3 8.33

25–34 10 27.78

35–44 12 33.33

45–54 6 16.67

55–64 3 8.33

[ 64 2 5.56 Education level

Illiterate 3 8.33

Elementary school 4 11.11

Intermediate school 3 8.33

Secondary school 6 16.76

Two-years college (diploma) 4 11.11

University degree 13 36.11

Postgraduate 3 8.33

Employment status

Public sector employee 21 58.33

Private sector employee 5 13.89

Self-employed 5 13.89

Student 1 2.78

Retired 2 5.56

Unemployed 2 5.56

Household average monthly income, SR a

\ 6000 4 11.11 6000 to \ 12,000 14 38.89 12,000 to \ 18,000 12 33.33 C 18,000 6 16.67

SR Saudi Riyal a 1 Saudi Riyal = $US0.27

M. K. Al-Hanawi et al.

Most participants were dissatisfied with the relatively

long waiting times involved in accessing public hospitals,

commonly referred to as ‘the unavailability of appoint-

ments’. Some participants linked this issue with the pres-

sure on public hospitals and the existence of special

privileges and favouritism, with some patients treated more

favourably than others based on personal connections and

social status (e.g. being a friend or relative of medical staff

working in the healthcare facilities). One participant shared

this feeling by stating: ‘‘someone I know is friends with a

hospital administrator and got straight in, while my family

and I always have to wait too long to get appointments’’.

Approximately one-quarter of participants reported

feeling forced to incur expenditures by using private

healthcare services because of long waiting times and

unavailability of appointments at public hospitals. Three

participants linked their use of healthcare services at pri-

vate hospitals to the lack of hospital beds in the public

healthcare sector. One participant stated, ‘I had to wait six

months in order to have a gallbladder operation, so I

decided to have it done at a private hospital and paid for the

surgery out of my own pocket’’.

Individuals using public healthcare services could also

find themselves paying for treatment and incurring indirect

costs, such as for travel and absences from work, even

though the service itself is free to access. For instance, two

participants living in a suburban area reported that their

local public hospital could not treat their critical health

condition and they were referred to the main city hospital

for treatment. One participant explained ‘‘I have to travel

every month to the main city hospital to be treated, and this

is really costly for me’’. Eleven participants complained

specifically about the lack of hospital beds and the long

waiting times in public hospitals. Detailing his experience

of waiting times, one participant stated ‘‘my mother is

trying to get treatment in one of the government’s specialist

hospitals; she has an appointment in three months. This is a

big problem for some complicated cases in which the

patient might die before he/she gets the appointment or has

access to treatment’’.

A number of areas were also criticised, such as the

attitudes of staff members, the unavailability of drugs,

irregular ward visits by doctors, and even a lack of hygiene

in some healthcare facilities. Seven participants com-

plained that staff attitudes were inappropriate or unpro-

fessional. Additionally, six participants perceived that

some public hospital doctors allowed conflicts of interest to

interfere with their work, stating that these doctors had

their own private clinics or also worked concurrently at

private hospitals and asked patients to visit their private

clinics for treatment. This view is summarised by a

70-year-old female participant: ‘‘I needed surgery on my

eye; the doctor offered me an appointment four months

away to do the surgery at the public hospital, or to go to his

private clinic to do it the next day’’.

Only seven (19%) of the total sample were covered by

private health insurance. Five (71%) were private sector

employees who received private health insurance from

their employers, which covered them and their families in

accordance with Saudi labour law. One participant’s pri-

vate health insurance plan was provided to him by the

government, whereas another was paid for via private

means. Of these seven participants, five (71%) expressed

satisfaction with private health insurance and private

healthcare services.

However, some dissatisfaction was expressed with

regard to private insurance and services provided by pri-

vate healthcare facilities. More specifically, participants

reported long waiting times for insurance patients com-

pared with those who paid cash directly. Two participants

(29%) stated that some private hospital doctors do not treat

patients covered by insurance; instead, they only accept

Table 2 Reasons for dissatisfaction with the public

healthcare services

Reason N (%) (n = 18)

Waiting times in accessing public hospitals (unavailability of appointments) 17 (94)

Waiting time before seeing the doctor in public hospitals 11 (61)

Lack of hospital beds 11 (61)

Existence of special privileges and favouritism 8 (44)

Attitudes of staff members 7 (39)

Lack of hygiene 7 (39)

Conflicts of interest 6 (33)

Unavailability of drugs 4 (22)

Irregular ward visits by doctors 4 (22)

Weak supervision 4 (22)

Unavailability of specialist doctors 3 (17)

Lack of privacy 2 (11)

No sufficient facilities 2 (11)

Healthcare Finance in the Kingdom of Saudi Arabia

patients who pay cash. Another participant, a single female

responsible for her mother and sister, complained that her

employer provided her with insurance that does not cover

her family. Further negative points included a lack of

choice regarding which private hospitals could be accessed

(because some insurance schemes are restricted to certain

hospitals) and limited coverage by private providers out-

side the major cities. This last point was made by a par-

ticipant who remarked that even when he had the privilege

of private insurance, it was ‘‘meaningless, because there

are no private facilities within reach of my home’’.

3.2 Perceptions of Healthcare Financing

Responsibility

Respondents were asked whose responsibility it is to

finance the public healthcare system. A total of 25 (70%)

participants stated it lies solely with the government. They

also expressed a belief that healthcare services should be

provided free of charge for all users, without any contri-

butions from them. The remainder of the participants

(30%) held a variety of views, predominantly that the

responsibility should be shared among stakeholders,

including the government, employers, employees and the

users who benefit from the system.

The most important point made, by six of the partici-

pants, was that resources are currently being wasted and

that the service is being misused, pointing to a direct

relationship between wastefulness and the lack of a market

system. One participant stated ‘‘if there are payment con-

tributions or fees that users pay, people will not use the

services unless they really need them. This will reduce the

pressure on public hospitals’’. Another view, expressed by

two other participants, was that some large institutions and

companies that benefit from being embedded within the

Saudi economy, such as banks and other large investment

companies, should shoulder some of the healthcare

financing burden and assist the government.

3.3 Willingness to Contribute to Financing Public

Healthcare Services

Despite the participants’ differing views and opinions on

whose responsibility it is to finance public sector healthcare

services, a clear majority of respondents (97%) would be

willing to contribute to financing public healthcare services

through a national health insurance scheme, but only under

certain conditions.

In total, 25 (70%) participants stated they would be

willing to contribute to financing public healthcare services

if the quality of healthcare services improved. Healthcare

service quality should be improved in areas where dissat-

isfaction was expressed, including increased access to

hospitals and prompt provision of appointments when

needed and reducing waiting times to see a doctor and

conduct laboratory tests and examinations. Other areas

where significant improvements were required included

ensuring the availability of prescribed drugs, greater

availability of specialist medical staff, improving staff

workplace attitudes, improving access to the full range of

services, and increasing privacy (e.g. guaranteeing private

rooms for inpatients).

Participants also expressed a willingness to contribute

financially if the government were no longer able to finance

public healthcare services solely from its own resources

(50% of the respondents). However, the participants

expressed a common concern that all family members

should be covered and that the coverage should be com-

prehensive and universal. Participants also emphasised the

necessity of the national health insurance scheme being

commensurate with Islamic principles and Sharia law.

3.4 Preferences and Expectations of the National

Health Insurance Scheme

The study participants were asked about their opinions,

preferences and expectations for the national health insur-

ance scheme with respect to stewardship of the system,

dimensions of the coverage, and the financing functions of

the health insurance system (collection and pooling of

contributions, and purchase and provision of healthcare

services).

3.4.1 Stewardship of the System

The participants’ opinions on the stewardship of the

national insurance system varied. Twenty (57%) partici-

pants proposed that a prospective national health system

should be managed by the public sector. They believed that

the public sector cares more for its citizens than does the

private sector, which is profit driven. Nine participants

believed that if the public sector managed the system, the

required contribution level would be affected. One partic-

ipant stated: ‘‘the public sector is not profit-seeking;

therefore, the contribution level would be smaller’’.

However, 10 (29%) participants believed the opposite,

stating that the private sector would be more adept at

governing the national health insurance system. They

perceived there would be greater value and improved

efficiency in a system operated and managed within the

private sector. The majority in this group emphasised

efficiency from private sector leadership and perceived a

higher level of professionalism in the private sector.

The remaining participants (14%) considered a com-

promise to be the optimal solution, with the establishment

of a new authority representing both public and private

M. K. Al-Hanawi et al.

sectors. They believed that such a partnership within the

stewardship could maximize the desired level of interest by

drawing on the benefits of each sector’s experiences. Two

participants suggested that ‘‘in a partnership, efficiency will

be increased and improved’’. Another participant stated ‘‘I

prefer partnership-based management to avoid public sec-

tor bureaucracy and private sector monopoly’’.

3.4.2 Dimension of the Coverage

The majority of participants (88%) expected that the pro-

posed national health insurance scheme should offer

comprehensive coverage and cover all family members

regardless of contribution size. One participant stated ‘‘the

health service is a right for us; we might contribute to

financing the system to improve it or help to sustain the

system, so full coverage should be offered along with any

suggested system’’. Another two participants stated that

‘‘insurance must also cover the cost of medicines’’. Two

other participants suggested that the system cover only

necessary healthcare services, thus excluding cosmetic

services.

Nevertheless, with respect to the membership type of

national health insurance, about 60% of the participants

suggested that membership should be voluntary. One par-

ticipant stated that ‘‘contributions should be voluntary, and

the quality of services provided should motivate and attract

people to participate’’. Five participants believed that

‘‘compulsory membership would only serve to increase the

financial burden on those who are already under financial

pressure and who cannot afford any additional expenses’’.

The remaining participants were in favour of compulsory

contributions, with one stating: ‘‘if membership were

compulsory, it would help the project to succeed. It would

raise revenue for the health insurance fund and would help

to achieve universal coverage’’.

With respect to preferences for contribution levels, most

participants (64%) preferred a fixed-rate contribution,

ideally as a membership contribution per person. They

believed this method would be the fairest, with one par-

ticipant stating: ‘‘it is not fair to pay a contribution on the

basis of wages, because, at the end, the same healthcare

services will be provided for all’’. Other participants

believed the government should support healthcare ser-

vices, with public contributions acting as a membership fee

to complement government financing.

On the other hand, a few participants preferred a wage-

based rate deducted directly from an employee’s salary;

they believed this would be the easiest method to imple-

ment, as the government could deduct contributions auto-

matically. One participant stated: ‘‘It is easier to calculate

the contribution on the basis of salary, and having the fees

deducted directly is a fair method’’. Another participant

stated: ‘‘If the contribution were based on income or wages,

those with lower incomes would pay less than those with

higher incomes. It would be a more equitable method’’.

All participants supported the idea of exemptions for the

poor. Some participants suggested an exemption for those

on limited incomes, especially poor and the retired people.

Five participants suggested that the government could pay

poor people’s contributions from the Zakat, which is an

obligatory payment made annually under Islamic law,

whereby an individual donates a certain proportion of

wealth each year to charitable causes.

3.4.3 Collection and Pooling of Contributions

Nearly three-quarters of the participants (71%) preferred

the public sector to be responsible for collecting contri-

butions. This view can be linked to the trust that the Saudi

public places in the government, with one participant

commenting: ‘‘The government is really trustworthy in

collecting the contributions, as it maintains its citizen’s

funds. I have no trust in the private sector’’. By contrast,

four (11%) participants preferred the private sector be

responsible. The remaining participants preferred a new

authority with the public and the private sectors collecting

contributions and managing the entire system.

Regarding the pooling of contributions, all participants

preferred contributions to be pooled at the national level.

They preferred this for a variety of reasons, including the

desire to be fair to all and the belief that healthcare should

remain comprehensive and accessible anywhere in the

country. Views differed as to the level at which an insur-

ance system might initially be implemented, with 21 par-

ticipants believing it should start at the national level, ten

suggesting it should begin at the regional level, and the

other five participants suggesting implementation at the

sector level, beginning with the main government sectors.

3.4.4 Purchase and Provision of Healthcare Services

Most of the participants (64%) favoured the private sector

when it came to purchasing healthcare services, seemingly

based on the belief that the private sector would offer both

value for money and better quality. Six participants bluntly

stated that the private sector could even prevent corrupt

practices. In contrast, six participants preferred the public

sector, suggesting it would prioritise the welfare of Saudi

people over profit, with one participant stating it would

therefore ‘‘purchase the best medicine and equipment,

regardless of the prices’’. The remaining participants

favoured a public–private partnership, as they believed the

public sector has the experience necessary for purchasing

health services, including modern technology and

Healthcare Finance in the Kingdom of Saudi Arabia

equipment, and the private sector has a good system of

supervision.

With regard to service provision, nearly one-quarter of

participants preferred health services under national health

insurance to be delivered by the private sector. Five par-

ticipants believed this sector would maintain a better

quality of healthcare services. Another quarter of the par-

ticipants favoured the public sector. Four participants

trusted the public healthcare sector more, even though the

private healthcare sector performed better in terms of

waiting times, amongst other indicators. One typical par-

ticipant stated ‘‘I do not trust the private healthcare sector,

especially for treating complex health conditions and

conducting surgeries. My choice for such cases would

definitely be the public healthcare sector’’. The remaining

participants preferred both public and private sectors in

order to provide citizens with more choice so they could

choose healthcare services from their favoured sector.

4 Discussion

Our findings suggest interviewees primarily felt proud of

the public sector healthcare system. They acknowledged

the inclusiveness of public healthcare services provided at

all levels: primary, secondary and tertiary. They also

acknowledged the positive role of the public healthcare

system in providing healthcare services and medicines free

of charge to the entire population, as well as to all Muslims

who visit the country for Umrah and Hajj. However, they

criticised the public healthcare system for the long waiting

times to obtain appointments and access healthcare ser-

vices. This criticism was particularly applicable for some

surgical procedures, for which waiting times of several

months was not unusual [3]. This issue has forced many

Saudis to use private hospitals. Perhaps unsurprisingly,

most private healthcare services, before the implementa-

tion of the CEBHI, were provided to Saudis who were

eligible for free healthcare services through the public

sector [3].

Dissatisfaction was also noted in existing private health

insurance. Nearly one-fifth of participants who were cov-

ered by private health insurance made claims at some

point, and none of this group were fully satisfied with their

health insurance policy. The main causes of their dissat-

isfaction were (1) the long process to obtain approval from

the insurance company; (2) the lack of doctor choices, as

some doctors do not accept insured patients and prefer to

only treat patients who pay cash; (3) lack of choice of

private hospitals, as some insurance schemes are limited to

a small number of hospitals; (4) access problems for pri-

vate hospitals in rural areas, as most private hospitals are

located in major cities [21]; and (5) the lack of

comprehensive private health insurance coverage, with co-

payments and additional charges for medicine being

required in some insurance schemes.

The perceptions of participants appear to be key to

viewing the responsibilities for financing healthcare. The

success of any new system, or substantial changes made to

an existing system, will require support from the society

that will use the services—a higher level of support is

associated with a greater likelihood of success [14]. This is

likely to be particularly significant when seen in the light of

Article 31 of the Constitution, which states that the gov-

ernment has a responsibility to provide healthcare for all

citizens. Therefore, it is not surprising that the majority of

participants stated that the financial responsibility lies

solely with the government.

Despite the participants’ varying views and opinions on

financing responsibility, the study presents evidence of the

Saudi people’s willingness to contribute to financing the

nation’s public healthcare system. However, this is condi-

tional on certain improvements being made in the identified

areas. The study also finds that Saudis are willing to con-

tribute financially if the government is unable to finance the

system from its revenue alone. This view indicates the

public solidarity necessary to sustain healthcare services

for the use of all citizens.

As anticipated, all participants expected to receive

comprehensive health coverage and that the coverage not

be linked to the amount or level of the contribution. This

response reflects the current situation, under which all

Saudi people receive full health coverage, free at the point

of delivery, without any financial contribution. Therefore, a

downgrade of coverage level when introducing financial

contributions would not be acceptable.

The majority of participants expressed a preference for a

national health insurance scheme under the stewardship of

the public sector, as they judged the public sector to be

more qualified to manage it, as well as having more

authority, being more trustworthy, and caring more about

its citizens, than the profit-driven private sector. However,

some participants who preferred the private sector

expressed concerns about the bureaucratic and corrupt

practices in the public sector.

The majority of participants preferred a fixed-rate con-

tribution (membership fees). This is surprising in a country

that has a formal, structured economy where many people

have a stable income. However, the participants appeared

to show a sense of altruism and solidarity by supporting the

idea of lower contributions for lower-income groups and

exemptions for the poorest households, with some sug-

gesting the government should take responsibility for the

poorer citizens’ contribution to the insurance fund.

Study participants largely supported voluntary mem-

bership, driven by the fear of imposing an additional

M. K. Al-Hanawi et al.

financial burden. However, in contrast to the views

expressed by the participants, a compulsory membership

would, on a practical level, be much more effective in

maintaining universal coverage and compelling all people

to contribute to the health insurance system [22–25]. This

is supported by evidence from the implementation of

compulsory car insurance in the country, which led to

nearly universal car insurance coverage in Saudi Arabia.

Participants expressed a strong preference for a national

level of risk pooling. This preference is linked to an ability

to collect more revenue, ensuring universal coverage and

increasing the efficiency of the system. Scientific evidence

supports this preference, as a central pool could be more

efficient in reducing geographical inequities [26]. Partici-

pants had varied opinions regarding the level of the initial

implementation of the system. More than one-third of

participants (41%) did not support the establishment of the

system at a national level; rather, they supported either

regional- or sector-level implementation to begin with. The

rationale for this preference was to pilot the new system,

thus allowing mistakes in the system to be rectified before

nationwide roll-out.

In terms of responsibility for collecting contributions,

the majority of participants preferred the public sector for

trust reasons. As a purchaser of healthcare services, the

majority favoured the private sector, viewing it as more

efficient in the purchasing of high-quality equipment and in

controlling costs. As a provider of healthcare services, half

of the participants preferred both sectors to provide ser-

vices simultaneously. This preference largely stemmed

from the participants’ desire to be able to make choices

when treatment is needed. This finding is consistent with

the assertion that the public healthcare sector is preferred

for treating specialist or complex medical conditions,

whereas the private sector is more attractive both for minor

health matters and for luxury services.

5 Study Strengths and Limitations

This study used a purposive sample that was small but

suitable for exploratory qualitative purposes. The study is

therefore limited by sample size, and any future study

aiming to corroborate these results should employ a larger

sample. Moreover, because of the lack of reliable popula-

tion data at household level in Saudi Arabia, which pre-

cluded a fully representative sample, a varied sample of the

participants was purposively selected according to social-

economic class. This might raise the question of a potential

for selection bias. For example, the study sample is rela-

tively skewed towards the male sex. However, this study

was conducted at a household level, and for cultural and

religious reasons, the heads of household in Saudi Arabia

tend to be male and responsible for household members.

Nevertheless, the voices of women were represented in this

study. When better household-level population data in

Saudi Arabia becomes available in the future, representa-

tiveness of samples can be improved.

6 Conclusion

This study indicates that the Saudi people seek the best

possible quality healthcare and display strong feelings

about certain improvements. In the context of current

debates in the country regarding healthcare financing

options and the introduction of a health insurance system to

reduce the government burden and enhance sustainability,

this study tackles issues that should be of interest to policy

makers in the KSA.

Introducing a national health insurance system may be a

viable option to finance the Saudi healthcare system, and

further work is needed to confirm this on a broader scale.

The Saudi people show a willingness to contribute to

public healthcare financing on the condition that there is a

clear improvement in the quality of healthcare services.

There is also a willingness to contribute financially if the

government is no longer able to fund healthcare services

alone. However, this study does not estimate the Saudi

people’s willingness to pay, either for an improved quality

of public healthcare service or to ensure sustainability of

the current system. Hence, further investigation of this

issue is warranted.

The study also explores public preferences regarding the

financing function of the insurance system, providing a

better understanding of the societal preferences of the

public regarding healthcare provision and financing. To

address the clear variation in some preferences and

expectations, a new entity or independent body, built upon

a partnership between public and private sectors, under

government supervision, could serve as an acceptable op-

tion to the Saudi people. Finally, the results of this study

may be transferable to other countries (especially in the

Arabian Gulf region) that share similar cultural, economic

and religious contexts and face similar challenges, espe-

cially with healthcare financing. As such, in terms of an

original qualitative investigation, this study seeks to not

only guide policy makers on the viable implementation of a

national health insurance scheme but also prepare the

ground for further research and public debate.

Acknowledgements The authors are grateful to all respondents who participated in this study, and we appreciate the unconditional support

of Professor Muhammed Tanwer Abdullah for his constructive

feedback and comments on the manuscript. Thanks are also due to the

anonymous referees for their comments and suggestions that helped to

shape the paper in its current format.

Healthcare Finance in the Kingdom of Saudi Arabia

Authors’ Contributions MA conceived the idea, designed the study and analysed and interpreted the data under supervision from KV at

Aston University as part of MA’s PhD thesis. MA drafted the first

draft of the paper. OA and SA reviewed and suggested the structure of

the manuscript. All authors contributed to revisions of the manuscript

and approved the final version of the manuscript prior to its sub-

mission. MA is the overall guarantor for this work.

Compliance with Ethical Standards

Funding This work was supported by King Abdulaziz University, Jeddah, Saudi Arabia, in terms of a PhD scholarship for MA.

Informed consent Consent was secured from all respondents who participated in the study.

Conflict of interest Mohammed Al-Hanawi, Omar Alsharqi, Saja Almazrou, and Kirit Vaidya have no conflicts of interest.

Ethical approval All procedures performed in studies involving human participants were in accordance with the ethical standards of

the institutional and/or national research committee and with the 1964

Helsinki declaration and its later amendments or comparable ethical

standards. This research study has been reviewed and given a

favourable opinion by Aston University Research Ethics Committee.

The study was designed and conducted in accordance with the ethical

principles established by Aston University. In addition to ethical

approval from Aston University, the study also received ethical

approval from the MOH in Saudi Arabia.

Open Access This article is distributed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International

License (http://creativecommons.org/licenses/by-nc/4.0/), which per-

mits any noncommercial use, distribution, and reproduction in any

medium, provided you give appropriate credit to the original

author(s) and the source, provide a link to the Creative Commons

license, and indicate if changes were made.

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