Health care is an increasing concern for the governments of the Gulf Cooperation Council (GCC) states—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE)—which want the private sector to play a much more active role in providing and financing that care. Gulf-area health care systems may be far better than they were 20 years ago, but many residents remain unsatisfied with the availability and quality of care at government-run hospitals and clinics. Government agencies mostly lack the managerial skills needed to run health care facilities, and cash incentives alone haven’t been enough to attract specialists to treat the rising number of people with ailments such as heart disease and cancer.

Government-run hospitals and clinics are also ill prepared for a rapidly growing and aging population, as well as for the rise in chronic diseases such as diabetes, whose prevalence has grown as countries have developed. To augment services and raise standards of care, some GCC governments have already encouraged internationally renowned academic institutions to set up health care facilities in their countries. Many more private health care providers are required, however, to meet future demand. Big changes to government policy and regulation are needed to ensure that...