1
Healthcare in Indonesia: Future Growth Opportunities
Prepared for:
South East Asia Hospital Expansion Summit Jakarta, 27 May 2015
2
Topic
1 Overview: Health industry in Indonesia
2 Where did the smart money go?
3 Reasons to invest in Indonesia’s health industry
4 Challenges to Indonesia’s health industry
4
“People in Indonesia
spent over USD 26
billion on
healthcare last year –
more than 300%
growth since 2005.
”
Source: The World Bank
5
“The industry growth
is driven by
population
growth, boost in
the economy and
government
support.”
Source: McKinsey Global Institute
6
“The industry is held
back by low health
expenditures,
shortage of
healthcare
professionals and
inequitable health
financing.”
Source: The World Bank, Spire Research and Consulting
8
Overview: Health Industry in Indonesia
Source: The World Bank, Ministry of Health, Spire Research and Consulting
+255MILLION POPULATION
27%CONSUMING CLASS
56%MIDDLE CLASSPOPULATION
POPULATION
4th Largest Population in The World
Community Health Centers
General Hospitals
Specialized Hospital
9,671
1,882
538
Number of Healthcare Service Providers in Indonesia (2015)
Health Services Provider
Gov-ern-ment65%
Private35%
Percentage of Hospitals in In-donesia Based on Ownership
(2015)
Government Private
9
Spread of General Hospitals (Public/Private) in Indonesia
Aceh43/16
Sumut111/48
Sumbar
35/4
Riau24/25
Jambi16/12
Sumsel34/12
Source: Ministry of Health
Bengkulu
17/1
Lampung26/18
Kep. Babel12/3
Kep. Riau17/4
DKI Jakarta52/43
Banten23/35
Jabar108/11
4
Jateng167/51
DIY37/14
Jatim169/8
7
Bali28/17
NTB18/6
NTT37/3
Kalbar29/7
Kalteng
17/1
Kalsel21/5
Kaltim26/15
Sulut35/3
Sulteng22/1
Sulsel49/11
Sultra22/2
Gorontalo
10/1
Sulbar
9/1
Maluku
26/0
Malut19/0
Papua Barat12/4
Papua34/2
10
Number of Hospitals in Indonesia Based on Class & Spread of class A and B Hospitals
Source: Ministry of Health, Spire Research and Consulting
3 10
38 201
8 67 5 15
4 28
0 4
0 2
A B C D Unclassified
58
327
843
462
730
Number of Hospital in Indonesia Based on Class (2015)
Number of Hospital
Class A HospitalClass B Hospital
To promote equitable growth and spread of hospitals, the government gives maximum 67% foreign ownership for new investors.
Spread of class A and B Hospitals in Indonesia
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Medical Staff in Indonesia
Source: Ministry of Health
Ratio of doctor : patient in Indonesia is around 1 : 3,500, much lower than the government’s goal at 1 : 2,500.
2010 2011 2012 2013
25,33333,172
37,36441,841
8,403
16,574
27,333
36,756
Number of General Practitioners and Medical Specialist in Indonesia
General Practitioners Medical Specialist
2010
2011
2012
2013
169,797
230,280
235,496
288,405
Number of Nurses in Indonesia
Nurses
12Source: The World Bank
Indonesia Malaysia Philippines Singapore Thailand Vietnam
35.52 182.83 47
1057.77
95.45 36.48106.63423.43
121.6
2507.43
264.35 111.17
Healthcare Expenditure per Capita (in USD)
2005 2013
Indonesia Malaysia Philippines Singapore Thailand Vietnam
2.793.29
3.91 3.73 3.55
5.38
3.07
4.03 4.4 4.55 4.57
5.95
Percentage of GDP Spent on Healthcare
2005 2013
Healthcare Expenditure in ASEAN region
13Source: Global Health Expenditures Database, WHO
How People in ASEAN Finance their Healthcare Expenditure?
Indonesia Malaysia Philippines Thailand Vietnam0
20
40
60
80
100Breakdown of Healthcare Expenditure by Channel
Private Health Insurance Social Health Insurance
Government-Financed Healthcare Other Private Expenditures
Out of Pocket Payments
15Source: Spire Research and Consulting
Preferred Destinations for Indonesian Medical Tourists
1
Malaysia
2Singapor
e
3India
4Thailand
In 2012, Indonesians
spend around USD 11.5 billion a year for healthcare services
abroad.
16
1
2
15
20
71
Source: Cybermetrics Lab
Best hospitals in various countries based on ASEAN Ranking System
Philippines Heart Center
Queen Sirikit National Institute of
Child’s Health
Singapore National
University Hospital
University Malaya Medical
Center
Rumah Sakit Mitra Keluarga
Group
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Price Comparison of Selected Medical Procedures in Several Countries (in USD)
Source: Malaysia Healthcare Travel Council, 2012
Health
care
Byp
ass
Heart
Val
ve R
epla
cem
ent
Angio
plas
ty
Hip R
epla
cem
ent
Hyste
rect
omy
Knee
Repla
cem
ent
Spina
l Fus
ion
0
4,000
8,000
12,000
16,000
20,000
Thailand Singapore India Malaysia
19
Singapore
Malaysia
Indonesia
Thailand
Philippines
Population Growth
Income Growth Penetration Regulations
Medical Tourism
Country Attractiveness to Private Healthcare Investment over Medium Term
Source: Credit Suisse 2014
Unattractive
Neutral Attractive
21Source: Spire Research and Consulting
Low health expenditure (USD 106.63) compared to other ASEAN countries.
Shortage of doctors and medical professionals (1 : 3,500 instead of 1 : 2,500).
Inequitable health financing resulting in discrepancy in hospitals across areas.
Challenges to Indonesia’s Health Industry
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Jakarta [email protected]
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