Foreign Investment in Indonesia’s Healthcare Sector: Clinics, Hospitals, and KEK Sanur

A hospital operator closing in on a Jakarta acquisition assumed the deal structure could mirror what a colleague had just done in Bali. It could not. The colleague’s facility sat inside a designated economic zone. The Jakarta target did not. Same sector, same investor profile, same ambition, and yet one deal could close with full foreign ownership while the other hit a ceiling at 67 percent before the shareholders’ agreement was even drafted.

That gap is not a technicality. It is the single fact that determines how a foreign investor should structure a healthcare acquisition or greenfield project in Indonesia, and it comes down almost entirely to one question: does the address sit inside a Special Economic Zone or not.

Two Different Numbers, Depending on Where the Hospital Sits

Under Indonesia’s Positive Investment List, private hospitals are open to foreign ownership up to 67 percent almost everywhere in the country. That is a meaningful liberalization from the pre-2021 environment, and it is often the number that shows up in a first pass of investment research. What that research frequently misses is the exception sitting right next to it. Inside a designated Special Economic Zone (Kawasan Ekonomi Khusus or KEK), that same hospital activity can be structured at 100 percent foreign ownership.

The broader mechanics behind how Indonesia moved from a restrictive Negative Investment List to today’s activity-by-activity Positive List are covered in detail in XPND’s explainer on why the DNI no longer exists and what replaced it. What matters specifically for healthcare is that this sector did not simply get liberalized once. It got liberalized twice, at two different ceilings, depending entirely on geography rather than on the investor, the capital amount, or the hospital’s clinical specialization.

Why Clinics and Hospitals Are Not the Same Investment Decision

Healthcare and clinics get discussed as a single sector constantly, and that habit causes real structuring mistakes. The two carry different classification systems, different capital thresholds, and, in practice, different accessibility for a PT PMA in the first place.

Hospital Classification Tiers Set the Real Capital Floor

Hospitals in Indonesia are classified under Minister of Health Regulation No. 3 of 2020 on Hospital Classification and Licensing (Klasifikasi dan Perizinan Rumah Sakit), which sorts facilities into tiers based on service capacity, bed count, and specialist coverage. Each tier carries its own minimum investment threshold set by the Ministry of Health, and that ministry-level figure overrides the standard PT PMA capital requirement that would otherwise apply under general OSS rules. A foreign investor who budgets a hospital project against generic PT PMA capital minimums, without first confirming which classification tier their intended facility falls into, is very likely underfunding the license application before it is even filed. The KBLI selection process that determines which classification and licensing pathway applies in the first place is explained in full in XPND’s KBLI 2026 guide for foreign investors.

The Basic Clinic Code Is Often Not Available to a PT PMA at All

This is the detail that catches smaller healthcare investors off guard. The general clinic activity classification is structured, under current OSS risk categorization, around micro and small business scale only, which means a straightforward PT PMA cannot simply register under that baseline code the way it might for a hospital-level facility. A foreign investor planning a clinic-scale operation typically needs to either structure the facility at a scale and specialization that maps to a different KBLI code entirely, or build the project as a hospital-classified facility from the outset. Confirming which path actually fits an intended clinic concept before signing a lease or committing capital avoids a scenario where the facility is built and the classification does not support the ownership structure the investor assumed.

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KEK Sanur Is Where the 100 Percent Rule Actually Applies

Bali’s Sanur Special Economic Zone is not a generic tax incentive wrapper applied to an existing neighborhood. It is Indonesia’s first health-focused SEZ, established under Government Regulation No. 41 of 2022, covering 41.26 hectares of the Sanur Beach area in Denpasar, roughly thirty minutes from Ngurah Rai International Airport. The zone was developed by PT Hotel Indonesia Natour, a subsidiary of state-owned tourism holding company InJourney, and its anchor facility, Bali International Hospital, operates in affiliation with the Mayo Clinic Care Network in the United States. President Prabowo Subianto formally inaugurated the hospital in 2025, describing the zone as a template the government intends to replicate across other sectors.

The economic logic behind the zone is explicit rather than incidental. Indonesian officials have estimated that a meaningful share of the population, projected in the range of 123,000 to 240,000 individuals annually by 2030, currently travels abroad for medical treatment the domestic system does not yet retain. Government projections tied to KEK Sanur put the potential foreign exchange savings from reversing that outflow at roughly Rp86 trillion by 2045, against a projected Rp10.2 trillion in zone investment and an estimated 43,647 jobs created. Retaining that outbound medical tourism spend, not simply attracting new foreign visitors, is the stated reason the ownership ceiling was set differently here than anywhere else in the country.

For the broader tax holiday, land use rights, and multi-year KITAS incentives that come standard with KEK status generally, XPND’s comparison of Special Economic Zone incentives across Indonesia’s active KEKs covers those mechanics in full, and the site’s broader look at the most promising investment sectors for 2026 places KEK Sanur alongside the country’s other priority zones. What neither of those pieces spells out, and what matters most for a healthcare-specific investor, is that the ownership ceiling itself, not just the tax treatment around it, changes inside this particular zone’s boundary.

Foreign Medical Staff Follow a Separate Compliance Track Entirely

Owning 100 percent of a hospital inside KEK Sanur does not automatically clear a foreign physician to practice inside it. Indonesia’s omnibus Health Law, Law No. 17 of 2023, which restructured the country’s health regulatory framework by revoking eleven prior laws, governs medical practice licensing nationally, and every practicing physician, Indonesian or foreign, still needs individual registration through the Indonesian Medical Council (Konsil Kedokteran Indonesia or KKI). That registration produces two separate documents a facility cannot operate without: a Surat Tanda Registrasi (STR), the practitioner’s registration certificate, and a Surat Izin Praktik (SIP), the location-specific permit to actually practice at a given facility.

This distinction matters operationally more than it might first appear. A hospital’s corporate ownership structure and its clinical staffing compliance are two entirely separate regulatory tracks, run by different authorities, on different timelines. A facility can be fully licensed as a business and still be unable to open a specific specialist department because an individual physician’s STR or SIP has not cleared. Foreign specialists brought in under this structure also need the correct immigration pathway sorted in parallel, a process covered in XPND’s overview of Indonesia’s current KITAS framework for foreign professionals and investors.

What a Realistic Investment Timeline Actually Requires

Bringing the ownership question, the classification tier, and the staffing track together, a realistic sequence for a foreign healthcare investment in Indonesia looks something like this.

• Confirm whether the intended facility qualifies as a hospital or clinic under current KBLI classification, since the two follow entirely different licensing paths
• Verify the Ministry of Health capital threshold tied to the specific hospital class being targeted, rather than assuming standard PT PMA minimums apply
• Decide early whether the project sits inside KEK Sanur or a comparable zone, since that single decision sets the ownership ceiling at 67 percent or 100 percent
• Begin KKI registration, STR, and SIP processing for foreign medical staff in parallel with facility licensing, not after it
• Plan for BPJS network integration separately if the facility intends to serve domestic patients alongside international ones, since that integration runs on its own approval track

None of these steps are unusual individually. What causes real delay is treating them as a single linear process when they are, in practice, three parallel tracks that only converge at the point the facility actually opens its doors.

XPND’s healthcare sector team works through exactly this kind of layered structuring, checking which ownership ceiling actually applies to a specific address before capital gets committed, and coordinating the classification, licensing, and foreign staffing tracks so none of them becomes the bottleneck holding up the other two. The 67 percent cap and the 100 percent exception are not two different levels of government generosity. They are the same policy applied to two different locations, and knowing which one a project sits in is worth confirming before the shareholders’ agreement, not after.