PHSSR Saudi Arabia 2025

for care delivery. In addition, the programme seeks to attract local and foreign direct investments. Further investments should be directed towards closing the gap between urban and rural areas. The National Centre for Privatisation initiative will see an expanded role for the private sector in healthcare delivery with the privatisation of close to 290 hospitals and 2,300 primary health centres, which will continue to deliver publicly-funded services. The distribution of spending across regions and health system sectors varies depending on the source of funding. The government is the main source of health system funding, with spending distributed as follows: •Primary healthcare : Approximately 25% of the government health budget is allocated to primary healthcare, including preventative and curative services provided by primary care centres and clinics. •Hospitals : Approximately 40% of the government health budget is allocated to hospitals, including the operation and maintenance of public hospitals and specialised centres. •Health administration : Approximately 10% of the government health budget is allocated to health administration, including management and regulating costs. •Other health services : Approximately 25% of the government health budget is allocated to other health services, including research, training and support services. Payment mechanisms and models The payment mechanisms for primary, secondary and tertiary care providers vary depending on the type of provider and the location of the service. Primary care providers are primarily paid through a fee-for-service model. The government provides a subsidy to primary care providers to ensure that services are accessible by all citizens and residents. However, some vulnerable groups such as low- income individuals and undocumented migrants still face financial barriers. Secondary and tertiary providers of specialised services such as surgeries and complex treatments, are primarily paid through a combination of fee-for-service and global budgeting models. The government provides global budgets to hospitals and other specialised providers to ensure they have the resources needed to provide high-quality care. These payment mechanisms have both positive and negative impacts on the healthcare system. On the positive side, the fee-for-service model incentivises activity, and ensures that providers do not have an incentive to skimp on quality or select patients on the basis of risk. The global budgeting model for secondary and tertiary care providers ensures good cost-control. However, the fee-for-service model for primary care providers may lead to the overutilisation of services and increased costs for patients, while the global budgeting model for secondary and tertiary care providers may limit the availability of specialised services, particularly in rural areas. Value-based payment models are designed to incentivise healthcare providers to deliver high-quality patient-centred, e fficient and effective care. These models are increasingly being adopted in healthcare systems worldwide, including in Saudi Arabia. The MoH has introduced a number of value-based primary care payment models, including pay-for-performance and capitation payment models. These models incentivise primary care providers to deliver high-quality care by, respectively, rewarding them for meeting certain quality metrics or by providing a fixed payment per patient, adjusted for patients’ risk characteristics, which promotes a focus on preventative care and cost- containment. However, despite ongoing efforts to introduce value-based payment models into secondary and tertiary care, progress has been limited and the global budgeting model remains the predominant payment mechanism. Some hospitals are experimenting with bundled payments based on diagnosis-related groups (DRGs), which incentivise providers to maximise e fficiency and deliver coordinated care across the entire care episode. The implications of value-based payment models are both positive and negative. On the positive side, they may incentivise the delivery of high- quality, patient-centred care, which can lead to better health outcomes and lower costs. However, 36 Sustainability and Resilience in the Saudi Arabian Health System The Partnership for Health System Sustainability and Resilience