By J N GITIMU

NHIF Management wish to comment on your editorial of Tuesday 12th June 2012 that partly touched on proposed reforms on National Hospital Insurance Fund.

First, the fact you gave that the number of Kenyans in the formal sector with medical insurance is less than two per cent is inaccurate.

A comparison of our active members with government statistics appearing in latest Economic Survey reports indicate NHIF has covered over 95 per cent of formal sector workers.  An IFC/Deloitte report on strategic review of NHIF and market assessment of prepaid Health schemes that is available on the website has statistics on medical insurance coverage to Kenyans.

NHIF is extremely efficient given it has operated on the premiums legislated way back in 1989 that ranges from Sh30 to Sh320.  With these contributions, NHIF has expanded services to virtually every county which puts it at an advantage with the advent of devolution of services to the counties.  It has also accredited over 600 health providers for members to access healthcare services.

The Fund has embraced innovative revenue collection methods that include Electronic Funds Transfer, direct banking of contributions into NHIF accounts by employers and have forged healthy partnerships with banks on this.

Informal sector workers are remitting contributions via M-Pesa, a service that the Fund will soon extend to small employers.

In a nutshell, NHIF really do not need any assistance on revenue collection as regard the formal sector.  It is worth pointing out that Kenya Revenue Authority collected NHIF contributions in 2001 but had to sever this partnership after six months because the Fund ended up receiving the money from KRA which was not accounted for employer-wise.

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The Fund now not only accounts the contributions employer-wise but individual-wise.  Employers submit details of each employee contributions for update of individual member account.

Once health demands arise, a health provider has to confirm online on compliance status of that account before one accesses services. Employers and Health providers have been painstakingly trained on these aspects.

During the period NHIF partnered with KRA, the exercise was a total failure. The collections were not pegged to employers which made it impossible to know which employers were compliant and revenue collection for the Fund also plummeted. NHIF continues to survive on premiums last raised in 1989.

To lose further revenue through a method that has been tried and proved to be totally flawed would be setting the Fund back significantly.

To introduce a system that is purely beneficial to KRA and detrimental to NHIF and by extension the stakeholders is by no means a solution to a perceived problem.

On compliance, NHIF is shifting recruitment efforts to the informal sector which has  paltry coverage on medical insurance because employer contributions are tracked electronically and after due dates, officers are able to quickly approach a few employers that may be late in remittance.

The issue of administrative costs by NHIF has occurred frequently in the media and some comparison with other countries have been pointed out. On top of prevailing contributions largely over shadowed by inflation over the last 23 years, this is the only Fund that so far employers are not matching employee contributions.

Secondly there are no government subsidies from General tax revenues for coverage of the poor, vulnerable persons or partial subsidies to contributions of low income workers as happens in other social health insurance schemes in Germany, Japan, Taiwan, Korea, Philiphines, Ghana etc. If this is done, the administrative costs will reduce to less than ten per cent.

Despite the recent outcry on implementation of the Civil Service Scheme, our past customer satisfaction surveys up to December 2011 indicate majority of Kenyans were satisfied with NHIF services.

The setback occasioned by implementation of the Civil Service Scheme is being addressed and NHIF should bounce back to esteemed status to enable more Kenyans enroll to access affordable and quality healthcare services.

Wide consultations on reforms to improve services to Kenyans are critical more so to the institution providing that particular service.

As NHIF intensifies mass market education to accelerate uptake of the medical cover by those able to make contributions, a study is ongoing to inform how best to go about covering poor persons and will be making proposals to the government health service delivery.

Some part of general tax revenues collected by KRA needs to be channeled to the social health kitty for coverage of poor and vulnerable persons.  This will help the Fund to compliment services being offered to these people through government healthcare facilities.

The writer is the GM-Operations & Marketing at NHIF.