BMI View: W e are positive towards the overall development of the Turkish healthcare sector , as the Turkish government has implemented significant changes to attract private sector investment. However, sub - regionally , we note that there remain many challenges yet to be address ed . Primarily, the distribution of healthcare expenditure in the country remains largely une qual. The densely populated w estern Turkey and the area surrounding the capital Ankara continue to experience large increase s in infrastructure and medical workers, whereas the east of Turkey has experienced little improvement in all indicators. We expect this trend to continue for the medium term , especially as more manufacturing capacity is to be established in w estern Turkey. This report gives a picture of healthcare trends and forecasts within Turkey's varied regions.
The bulk of Turkey's population resides along the Aegean coast, the Western Black Sea region and the European portion of the country. The centre and the east of the country are harsh, arid regions interspersed with large areas of steppe. As such, the population is concentrated in the west of the country, with population density highest in the northwest.
Levels of gross state product per capita roughly follow in line with geographic distribution. Turkey's wealth and spending power is primarily concentrated in the west of the country (specifically around the greater Istanbul area and surrounding provinces on both sides of the Eurasian land corridor), and in Ankara. This has lead to inward migration from east to west and, as such, healthcare expenditure has been primarily concentrated in the west to accommodate these growing, urban populations.
Concentration of healthcare infrastructure in these densely populated areas has allowed better access to quality care. At the same time, this increase in population and the rise in incomes in western Turkey have made the private sector viable, providing some relief for public sector hospitals while offering improvement in the quality of healthcare services. As a result, most doctors, nurses and other medical professionals have been recruited in these regions. Our forecasts reflect this to an extent, with our forecasts generally posing much lower growth in the number of staff and infrastructure for the eastern provinces and regions compared to their western counterparts.
We see healthcare spending and healthcare infrastructure receiving significant boosts over the coming years. Turkey's Ministry of Health has embarked on establishing large-scale public-private partnerships (PPPs) to develop healthcare infrastructure in order to meet the needs of Turkey's growing populations and address existing deficiencies within the public sector. These PPPs will focus on bringing up the standards of healthcare on the Anatolian peninsula, where there are clear deficiencies in terms of healthcare worker density and outpatient services. To this end, in December 2014, GE Healthcare, Gama Holding A.S. and Turkerler Holding signed a Memorandum of Understanding for the development of two Turkish Ministry of Health PPPs. The Kocaeli Health Campus Project and Izmir Bayrakli Health Campus Project represent a commitment by Turkey to its healthcare transformation agenda via PPPs.
In September 2013, the Ministry of Health announced contracts worth TRL15.7bn (USD7.8bn) for the construction of 15 city hospitals and a health centre to a consortium of mostly Turkish firms as well as some Italian companies. These hospitals will be rented out by the government to the private sector, in the belief that private operators will manage healthcare services more efficiently than Turkey's archaic public healthcare sector. Turkey has experienced a swell in demand for private healthcare over the last decade, a trend that has been catalysed by its enviable economic growth. Furthermore, as Turkish citizens have seen their incomes rise, their desire to access higher quality healthcare services has followed suit. Overcrowding and dissatisfaction with public services has pushed many into opting for private healthcare. Private healthcare facilities have also grown in number partly due to a combination of medical tourism from neighbours in the Middle East and Europe as well as to satisfy domestic demand.
In addition to increased private healthcare coverage, the ability of state hospitals to outsource services to the private sector, giving private facilities the opportunity to increase revenue, has been a key factor in the sector's expansion. By the end of 2015, the number of private hospitals is expected to have reached 620, compared with just 551 in 2010, considerably outpacing the expansion of Ministry of Health-run hospitals, which show just a 47 hospital increase over the same period. However in the government's 2016 reform plans, Turkish parliament will provide general health insurance for graduates and high school leavers for two years after graduation in a boost to expand healthcare protection.
The lack of regulatory certainty has lately been a barrier to foreign investment in Turkey's healthcare sector; this new piece of legislation provided guarantees, VAT exemption and cheap loans to foreign investors in return for renting hospitals built by the private sector for 25 years. It has cut red tape for investors, reducing the number of permits and level of planning permission required.
Turkish authorities are keen to see major, long-term investments in the country, given that the majority of capital inflows into the country have tended to be short term. The government has guaranteed support for international projects worth TRY500mn (USD279mn) and above, hoping to see bigger and more numerous long-term commitments from private financiers. The Turkish government is running a structural deficit on its social security system but this will be unsustainable in the long term as demand for healthcare accelerates. With these payment protection insurance deals, the Turkish government hopes to manage popular sentiment and accelerate the country's healthcare development without risking its fiscal position in the short term. The hospitals will be rented back from private developers by the state through long-term leases, in the hope that the private sector will latch onto the opportunity for long-term, stable earnings from the government.
The Turkish public healthcare system currently faces a severe shortage of qualified medical personnel, as the number of doctors entering training has trailed overall population growth. In Turkey, there are, on average, 1.8 physicians per 1,000 people, a figure that vastly trails OECD countries. The reality is that this figure is actually worse as it includes private doctors. The shortages are most acutely felt in Turkey's more rural regions, where the bulk of the Turkish population is located, and where birth rates are the highest.
Espicom’s Understanding Turkey's Regional Healthcare Markets Report allows you to explore Turkey’s regional markets by giving you a practical evaluation of opportunity and risk at the under-appreciated sub-national level.
Rich in statistics, charts and maps, this is the one report you need to fully appreciate the Turkey’s diverse regional health environments in the context of neighbouring provinces/states/territories and the national picture.
Written in association with Business Monitor International, this unique report uses data sourced in-house, providing analysis and forecasts from our experts covering key areas such as:
- Healthcare Expenditure
- Healthcare Facilities
- Healthcare Personnel
- Economic Activity
Published by Espicom - experts in the pharmaceutical, medical devices and healthcare field for over 30 years, Espicom’s Understanding Turkey's Regional Healthcare Markets Report brings together a range of often difficult to source information in one single, convenient and comprehensive publication.