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German Legal Expertise in the Middle East since 1981

Healthcare in Kuwait

Guiding Principle

In Kuwait the quality of health care is generally high and equal to that in Western Europe and theUSA, except for highly specialised treatment. It makes use of the latest technologies in the medical field. As the country got developed over the years and the economic conditions are flourishing, it can afford to have the best medical facilities and services. The main laws regulating the healthcare inKuwaitare the Labour Law, Insurance laws, and other social lawsafeguarding the the healthcare services in private and public sector. Generally it is held that  theKuwaithealthcare system is very developed and updated.

I.    Rules and Regulations related to Healthcare

1.   Labour Law

The Labour Law (Law No.38/1964) regulates the work force in the private sector inKuwait. The Ministry of Social Affairs and   Labour supervises the implementation of the Law. On December 23 2009 the Kuwaiti Parliament passed a new labour law, which provides better rights and conditions for the 2.3 million foreign workers but does not scrap the controversial sponsor system.

The new law, approved unanimously by lawmakers including cabinet members, will replace a 45-year-old law that was criticised as being in favour to the employer at the expense of workers / employees. Because of some consideration the Law has not yet bee published in the Kuwaiti Official Gazette and thus is not yet in force yet.

The new lawprovides more rights for workers in the private sector, including better annual leave, end of service indemnities and holidays.

It also sets tougher penalties, including jail terms, for businessmen who trade in visas or who recruit expatriate workers and then fail toprovide them with jobs, or who fail to pay salaries regularly.

The new law, however, fails to address the much-criticised sponsor system under which all foreign workers must be sponsored by a Kuwaiti employer, thus keeping expatriates at the mercy of their bosses.

Other oil-richGulf Statesapply similar systems. Nevertheless, the law requires the government to set up a public authority that takes on the responsibility of recruiting workers from abroad.

The proposed law would be the first major update ofKuwait’s 1964 Private Sector Labour Law, following 10 years of debate and revision. If approved by the National Assembly, it will go to the emir for his signature, which is expected.

The draft law includes many improvements for the covered workers, including a ban against arbitrary dismissal and discrimination based on gender or ethnicity. It requires child care in workplaces with at least 50 female employees. Itprovides penalties of up three years in prison or heavy fines for employers who do not pay their workers or who recruit workers and then do not provide thepromised jobs.

2.   Healthcare Insurance Law

The government’s policy of health insurance became effective in 1999 and was implemented on both citizens and expatriates based on the ministry’s intention to establish hospitals for those covered by this health insurance. The ministry’s aim was to lease out these hospitals on contract basis toprovide expatriates with medical facilities.

Kuwait’s residents were to receive treatment at these specially designated insurance and private hospitals. This was planned with the aim of decreasing the pressure on Government hospitals and giving them an opportunity toprovide better health services for those not covered by the health insurance system. From April 10th, 2000 health insurance was made mandatory for expatriates. No residence is renewed unless the premium for health insurance is paid and the renewal period is also linked to the period of health insurance coverage. Expatriates holding health insurance from local private insurance companies will be allowed to renew their residence for the period of validity of the insurance.

3.   Other Healthcare related Laws

Kuwait has a widespread system of social welfare on a paternalistic basis, financed by government oil revenues. It offers welfare services for the poor,provides free medical service and education to all Kuwaiti citizens, and spends heavily for waterworks, public gardens, and other public facilities. Social insurance legislation enacted in 1976provides for old age, disability, and survivor pensions, for which the worker pays 5% of earnings and the employer pays 10% of payroll. In 1999, retirement benefits ranged from 65% to 95% of earnings, depending upon the length of employment. Large subsidies for electricity, gasoline, and rice hold prices below market rates but contribute to the government’s annual deficit.

Women are denied equal rights and legalprotection under Kuwaiti law, and their testimony in a court of law is not considered to be equal to that of men. Women must first obtain their husband’s permission before applying for a passport. Kuwaiti women married to foreign men suffer legal discrimination, are not entitled to government housing subsidies and are required to pay a residency fee. Female political parties are banned, and women are not allowed to vote or seek national elective office. However, 33% of women of working age are employed, and some occupy professional positions. The government is actively working to segregate all classrooms by gender. Women (including foreign women) who wear Western clothing are often subject to harassment. Domestic abuse is common. Rape and abuse of foreign domestic workers is widespread.

Bedouin minorities face considerable legal discrimination. They are not entitled to citizenship, and are unable to work or enroll their children in schools

 II.  Healthcare in the in Day to Day Life

The health insurance set out in law covers the following basic health services:

  • The medical examination and the necessary treatment in clinics of general practitioners and specialists;
  • Laboratory and radiological investigations;
  • Surgical operation excluding plastic surger;
  • Treatment medicines and hospitalization expense to ordinary and emergency cases;
  • Ordinary dental treatment

III. Healthcare in the in Private Sector

The government is now taking measures to address this situation, with a number of capacity-building initiatives to increase bed inventories, improve human resources and encourage private sector development in the works. In 2007 the government unveiled a $173m plan to increase bed capacity, followed by a July 2008 announcement to spend $3.1bn on eight new hospitals. The first stage of the new plan will see the construction of the $1.2bn Jaber Al Ahmed Al Sabah Hospital, followed by the three-phase construction of eight additional hospitals with varied specialisations, which are expected to be operational in 2015-16. Retaining qualified staff in the public sector is also a priority, with salary raises introduced in February 2008 expected to help in this regard. Funding to the sector continues to increase. By 2008, total health care expenditure accounted for 3.7% of the country’s GDP. In March 2009, the minister of health requested a budget of KD962m ($3.42bn) for the fiscal year 2009/10. This expansion in funding will be used to offer additional health care services, with the Ministry of Health (MoH) planning to open 19 new health centres and support the private sector. The government is looking to expand the role of the private sector, with indications that it could enlist its help in building a national health insurance scheme.

IV.  Healthcare in the Public Sector

Kuwait’s healthcare system is both efficient and effective, and thus attractive to medical tourism, although the country’s pharmaceutical industry is limited. In 2006, although the Kuwaiti pharmaceutical market rose by 7% year-on-year to an estimated US$ 385mn, the value remains small by global standards. Nevertheless, as the rate of increase over the next five years is forecast to oscillate around the same figure, with the market reaching US$ 540mn in 2011, the value of prescription and branded drugs has room for further growth. The growth will be driven by demographic factors, as well as by the rising demand for private insurance, with foreign workers being excluded from state coverage.

Healthcare is presently by and largeprovided free to all Kuwaiti citizens, but the pressure on public finances will eventually result in a shifting of some financial responsibility away from the State. Moreover, the government is also likely to include more generics on the reimbursed drugs list to the detriment of branded, foreign-madeproducts that already suffer discrimination in terms of public subsidies. However, the wealthy population’s traditional preference for branded medicines will ensure their steady growth, although high drug prices inKuwaitare resulting in a growing number of people purchasing healthcare outside the country.

January, 2010 Roberta Di Siena
Meyer-Reumann & Partners – Dubai Office
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