Investment and PPP

Department

2020

Overview of PPP Opportunities and Projects

for Dubai

On Jan 4th 2019 the 50 year charter was announced by

HH Shk. Mohammed bin Rashid Al Maktoum

The Vice President and Prime Minister of the UAE, and ruler of

Dubai

Article 5: A Doctor to Every Citizen

We aim to provide citizens with medical consultations 247/ through hundreds of thousands of

doctors, specialists and medical consultants across the globe.

This will be facilitated by smart government application.

Our goal is to transform the medical system to bring doctors closer to individuals, enhance

awareness, and

utilize top medical minds globally to serve the health of our citizens.

2

Dubai is a vibrant city of opportunity for professionals, investors

and

entrepreneurs

The Dubai Advantage

Dubai is a gateway to growth markets with recognized quality of

life and ability to retain talent

88% of GDP is from

Financial Corporation

4th most visited city

in the world

THE HUB

Investor friendly destination

Quality of life and talent

retention

THE CITY

Over 200 Nationalities

15.8 million tourists in 2017

84% of population is between 15

and 64 Yrs.

THE GATEWAY

Open economyStrategic location

Dubai

International

Airport

8 hrs flights

to 2/3rd of

the world

140 airlines

260 destinations

Ranks #1 in the word Bank’s

logistics performance index

for MENA region

Number 1 city for quality

of living across the Middle

east and Africa for 5 yrs in

a row

Top 10 financial hubs in

the Bank2017 IFC ranking

3

Dubai Health Authority oversees the healthcare sector in the Emirate of Dubai,

and the health sector has witnessed significant growth in the past decade

CAGR 14-17

+8.1%

30.6 38.5

2014 2017

2.8

3.

1

2014 2017

CAGR 14-17

+3.9%

208 263

2012 2017

CAGR 12-17

+4.8%

Number of hospitals, per type of setting (2017, in no. of facilities)

6

201

0

2017

+10 Hospitals

2737

Public

Private

FacilitiesTotal number of

licensed facilities by

DHA (2014- 2017, in

thousands)

ProfessionalsTotal number of licensed

professional by DHA

(2014-2017, in thousands)

MO HAP

DHCC

(Private)

Snapshot of the Key Figures of Dubai’s Healthcare Sector

The number of outpatients, inpatients as well as the number of healthcare

facilities and professionals licensed by DHA have seen significant growth in recent

years

OutpatientsOP Volumes (2012-2017, in

millions)

7.3 9.

8

2012 2017

HospitalsEvolution of the no. of

Hospitals (2012-2017,

in no. of facilities)

CAGR 12-17

+6.0%

InpatientsIP Volumes (2012-2017, in

thousands)

Private

Regulate

d by

DHA

Public

Regulatory Bodies

4

6 3121

Health spending in Dubai has risen by 12% p.a. from 2012 to 2017, and there

exists opportunities for investment and growth in the health sector

Health spending has risen from AED 9.9 billion in 2012 to 17.5 billion in

2017, and this is estimated to reach AED 24 billion in 2020, supported by

health insurance reforms…

Source of funds

Evolution of healthcare expenses, by Source of

funds (2012-2017, in AED)

Use of funds

Hospitals 47%

Clinics 22%

Ancillary 2%

Pharmacies 9%

Outbound

medical tourism

14%

Admin & Finance

6%

Curative care 59%

Rehabilitative care 1%

Ancillary services 15%

Medical goods 14%

Preventive care 5%

Admin & Finance 6%

Healthcare expenses, by type of

provider (2014, in % of total healthcare

expenses)

Healthcare expenses, by type of care

(2014, in % of total healthcare

expenses)

…however, despite years of positive development,

there exists potential for growth in the health sector

…and the UAE is one of the top 10 economies

with the most efficient healthcare sector, and

ranked on top of Middle East countries...

#1 #2 #7 #8 #10 #11

#12Source: Bloomberg Health-Efficiency Index, 2018

Ho

ng

Ko

ng

Sin

ga

po

re

Jap

an

Au

str

alia

UA

E

No

rwa

y

Sw

itze

rla

nd

3.6% 3.4%

Healthcare expenditure in Dubai vs. GCC and OECD

countries (2014, in % of the GDP)

10.0%

Dubai GCC OECD

Governmen

t

Insurance &

Corporation

s

38%

Source: Dubai Health Investment Guide 2018, Health Accounts System of Dubai 2013-

20145

34%35% 32%

41%

42%

52%

60%

22%

25%

12.8 billion13%

8%

2012 201

4

201

6

2017

Out of

Pocke

t

9.9

billion

17.5 billion

16.0 billion

Health Investments Strategy is important to Dubai (Health Investment Strategy

2017-20)Projected Capacity Gaps in the Dubai Healthcare

Infrastructure

By 2030, DHA foresees a gap of ~1,590 inpatient beds, mostly in specialties such as orthopedics, respiratory medicine, pediatric

medicine, cardiology, long term care and obstetrics

90 96 89

225 241 227

Obstetric

s

Orthopedic

s

Pediatric

medicin

e2025

203

0

8,00

0

6,00

0

4,00

0

2,00

0

0

2020 2025 2030

Suppl

y

Deman

d

Evolution of Supply-Demand Gap in Inpatient Beds in Dubai, 2020-

2030

Gap:

~1,590

beds

Specialties with the Largest Inpatient BedGaps, 2025-2030

In # of

beds

Gap by Specialty in

2030– Orthopedics

– Respiratory

medicine

– Pediatric medicine

– Obstetrics

– Gastroenterology

– Psychiatry

– Cardiology &

Cardiothoraci

c

– General surgery

High

Mediu

m

Capacity Gap in Other Critical

HealthcareInfrastructure in Dubai in

2030

Gaps, in # of

beds

Primary care

Gap: ~726 OP rooms, by

2030

Long-term care

Gap: ~192 beds, by

2030

Gap:

~311

beds

Oversupply

: ~654

beds

6 Note: (*) Ultrasound, X-ray, Computed tomography, Mammography, Magnetic resonance, PETscan, etc.. Source: Dubai Clinical Services Capacity Plan 2018-2030.

Rehabilitation

Gap: ~192 beds, by 2030

Procedural care / Medical

imaging

• Ultrasound

Gap: ~484 units, by 2030

• Computed tomography

Gap: ~50 units, by 2030

• Mammography

Gap: ~43 units, by 2030

…leading to investment needs in certain medical specialties in terms of outpatient

rooms…

Gap analysis by specialty, in no. of outpatient rooms required (base case, 2018-

2025)

Projections are based on the following assumptions:

1.248 operational days per year

2.8 operational hours per day

3.70% planning occupancy per consultation room

4.Adjustments for National and Non-national utilisation based on current trends

5.Nursing demand has been split between adult and paediatric Hospital modes, no

supply captured but absorbed by other consultation rooms

Specialty Gaps (base

case)Specialty Gaps (base

case)

Source: Dubai Health Investment Guide 2018, Preliminary results from Dubai Clinical Services Capacity

Plan 2018-2030, developed by TAHPI7

Primary Care 524 696 1,218

Orthopaedics and

Rheumatology

77 31 75

Respiratory Medicine 10 20 37

Immunology & Infections 11 15 26

Endocrinology 33 21 13

Oncology 8 4 11

Haematology 1 3 7

Gastroenterology 47 35 0

Nursing care &

Allied health

357 463 761

Trauma and Injury 27 32 44

Neurology 1 12 35

Vascular Surgery 4 7 16

Urology 41 27 12

Renal Medicine 2 3 11

Neonatology 3 4 6

Dentistry 26 19 4

… As well as acute inpatient beds in 2020 and 2025 across certain specialties and

services

Gaps by specialty, in no. of additional acute inpatient beds required (basecase)

2020

Onco-

Psychiatry logy

Neuro- Cardio. &

Plastic surger

y

Gastroen- Renal

terologymedicine

Gyneaec

Neona- tolog

y

General Obste- ENT,

Headtrics

Resp.

medicin

e

& neck

Urology

Cardiot.

surger

y

Ortho.

&

Rheum.

Oversupply Optimum

coverag

e

Undersupply

(investment

needs)

2025

General

medicin

e

olog

y

Neuro-

Endocrin

surgery ology

surger

y10

87843

10101

71623273540517281

10

016

9208

log

y

Cardio. &

Onco- Cardiot.

logy

surgery

Plastic

surger

y

Renal

medicin

e

Obste-

Ortho.trics &

Rheum.

Resp.

medicin

e

Psychiatry

ENT,

Head

&

neck

Gastroen-

terology

Oversupply Optimum

coverag

e

Undersupply

(investment

needs)

General

medicin

e

Gyneae

c

ology

Neuro-

surger

y

Endocri

n

ology

Genera

l

surger

y

167

10

8969077675543

4118

6303233

6475

13

514

8

Urolog

y

Neona-

tology

Neuro-

logy

8 Source: Dubai Health Investment Guide 2018

Health Investments Strategy is important to Dubai (Health Investment Strategy 2017-

20)

Priority Investment Areas for Dubai Healthcare Infrastructure

for Diabetes,

Cardiology

and

Oncology

As part of its Investment Strategy 2017-2020, DHA has started identification of highest priority investment areas to fulfil its objective of

promotion and facilitation…

Focus of next 2-3 years… Focus for 3-5 years…

11Innovations

in

Primary Care

Ambulatory

Care

Urgent

Care

Clinics

Mental

Health

Chronic

Disease

Manageme

nt

Tertiary Care

Diagnostic Health

& Remote

Monitoring

Rehabilitation and

Physical Therapy

Home-based

care

Long-term Care

and Extended

care

Preventive Care &

Pharmacy

beyond- the-pill

Precision

Medicine

and Genetics

Population

Health

Management

Nursing

Homes and

Palliative Care

1

2

3

4

5

6

7

8

9

10

12

13

14

9 Source: DHA Investment Strategy 2017-2020,Advention

The Dubai Investment Guide maps the investment journey for different types of facilities / projects for healthcare services

e.g.New facility

licensing

process map

Source: Dubai Health Investment Guide 2019

10

Key Features of a PPP ModelPPP’s are unique in helping create value and transfer of risks to Private Sector

Public Private Participation (PPP) model is a partnershipstructured between the Public Sector/ Government andthe Private Sector to develop infrastructure or provideservices to the population based on an agreedallocation of risks and reward to the Private Sector.

The Key Components of a PPP Model are the following –

1. Financing – Identifying and selecting acceptablemodes of public and private funding for the project

2. Distribution of risks – assessing and designing a riskdistribution model across public and private sectorpartners

3. Business case – develop a business case that isbeneficial and feasible to the public and privatesector

11 Source: DHA Investments &PPP’s

PPP Models in Healthcare - ExamplesPPP models have been implemented across developed and developing regions of the

world helping drive lower capital costs, more efficiency, improved access and investment

in health

• $ 352 mn Joseph

Brant Hospital with

172 beds. Design,

Build and Finance

(DBF)

• 1.1 bn GBP Bart’s

Health Trust NHS

hospital and 430mn GBP

Bristol Trust NHS

• $ 460 mn Women’s

College Hospital –

Design, Build, Finance

and Maintain (DBFM)

Hospitals in

Canada

Hospitals in

Canada

Hospital Trusts

in UK

Hospitals in

Spain

• Hospital de La Ribera in

Alzira region for $ 91

mn. Payment through

capitation fees

• Eur 360 mn 1,000 bed

hospital in Elaziğ. 26

PPP’s planned

Hospitals in

Turkey

• $ 215 mn Burwood

Hospital in Christchurch

with 230 beds

Bumrungrad

Intl. Hospital

• $365 mn Royal

Women’s Hospital in

Victoria, Australia

Hospitals in New

Zealand

Tele-radiology in

Kenya

• GE partnership with

Kenya to deliver

teleradiology to 46 mn

people across 98

hospitals

Imaging

Diagnostics in

Brazil

• $ 40 mn project in the

State of Bahia to set up

and operate 45 new

equipment across 12

hospitals

Hospitals in

Australia

12 Source: DHA Investments &PPP’s

13

PPP Law and Guidelines in DubaiDubai has a PPP Law and PPP Guidelines developed by the Dept. of Finance (DoF) to support investments in healthcare, transport and other infrastructure projects for the Emirate

DHA is very focused on implementingmodels that are suited and tailored toDubai’s needs and that are within theframework of the PPP Law no 22 of 2015.PPP Guidelines issued by DoF governsdifferent models of PPP’s for bothgreenfield and brownfield facilities and weare reviewing and proposing differenttypes of models that are suited to differentprojects provided these allow for risksharing and risk transfer to the privatesector

Focus of PPP Law and Guidelines inDubai–1. Description of the different types of

PPP’s allowed and level of investment2. Evaluation and approval of PPP’s3. The process for development and

approval of a PPP project4. Payment Mechanisms and Risk

Allocation and transfer

Dubai PPP Law and Guidelines

DHA is implementing a PPP Project for Cardiology CoEThe Cardiology CoE is the first healthcare PPP project to be implemented in the Emirate of Dubai and aims to bring world-class cardiology services in partnership with private sector

Objectives of the Cardiology CoE*Highlights of CCoE and PPP Model

• The Cardiology CoE is expected to be a 100-120 bed

dedicated cardiology hospital focusing on cardiac ER, OP

and IP services;

• DHA aims to implement a DBFM PPP Model with the below

stated sharing of responsibilities between the Public & Pvt.

Sectors with the term of the PPP agreement of 25 years

• The CoE will be co-located within the Rashid Hospital

Complex

One –stop-

shop approach

with integrated

care continuum

Evidence based

international best

practice with focus on

screening and early

detection

Physician access

to clinical affiliation,

research &

technology

innovation

Sustainable

and predictable

costs with

access to

financially

vulnerable

segments

It will be flexible and

adaptable to support

remote patient

monitoring

Focus on physician

training, development

and education in Dubai

ResponsibilitySelected PPP Model - DBFM

(Design-Build-Finance-and Maintain, “DBFM”) with clinical affiliation

Revenues DHA

Capex Private Sector

Opex Private Sector (excl. Clinical Salaries paid by DHA)

Clinical StaffSelected medical and nursing positions by DHA

(40-50% of clinical staff), Clinical Affiliation partner to support recruitment & development

Non-ClinicalStaff

Private Sector is free to recruit and deploy staff for the suited positions

Availability Payment

DHA PPP CoReflects capex and opex incurred by PPP Co, along

with cost of funding (debt & equity)

14

DHA is also evaluating opportunities for PPP in 2020-24

Other PPP projects range from developing new infrastructure to enhancing

existing DHA services and improving access to care for the patient

population

Imaging Diagnostics

Dialysis

Spine

Diabetes

DHA is keen to improve utilization of equipment, quality and efficiency of services and

training of staff

Possibility of a risk – share partnership to manage radiology services of 3 hospitals (retaining

DHA staff) to reduce waiting times and increase revenues

Training and upskilling DHA staff will be a key component

Operating Agreement for managed services model to manage dialysis services for patients in

Dubai

To focus on efficiency, patient convenience and quality of outcomes (incl. access to care)

Needs to interface with primary care

Operating Agreement for managed services model to manage spine services in Dubai

Hospital for patients in Dubai

To focus on cost of care, patient trust and quality of outcomes (incl. access to care)

Objective is to bring best in class, highly qualified and experienced surgeons to Dubai

through this

Service enhancement and clinical affiliation for Dubai patients in diabetes care

To focus on cost of care, efficiency and quality of outcomes (incl. access to care)

In future it could include take over and turnaround of an existing center focused on UAE

National

patients

Improved

Efficiencies

Sustainability of

Services

Better Quality

Outcomes

Improved Access

to Specialized Care

Cost

Reduction and

Control

Increase

in

Revenue

Grow PatientVolumes

Overview of other proposed PPP projects in service enhancement and improvement

Concession Model or Operator Agreement for managed services model to manage LTC

services for

patients in Dubai

To focus on efficiency, patient experience and quality of outcomes (incl. access to care)

Expected to free up beds and critical care units in Rashid and Dubai Hospitals

Long Term

Care

15

Thank You