Employers seek more time to deduct new NHIF rates

By John Oyuke

Kenyan employers have asked for more time to implement the new National Hospital Insurance Fund rates endorsed by the Industrial Court on Monday.

The Federation of Kenya Employers (FKE) said the court ruling paving the way for execution of the enhanced scheme came close to the end of this month, when most employers had closed their payrolls.FKE Executive Director Jacqueline Mugo said employers should be given time to implement the deductions and manage workplace issues.

Ms Mugo, however, said employers are not in a position to absorb any extra costs arising out of this development, due to the skyrocketing cost of doing business.

The National Hospital Insurance Fund (NHIF) won a suit filed against it by the Central Organisation of Trade Union (Cotu) over introduction of new health insurance rates.

Cotu got an injunction

FKE was mentioned in the suit as an interested party.
The rates became effective from September 1, but Cotu got an injunction to suspend the implementation, until its case was determined.

On Thursday, the employers’ body urged the NHIF to manage the change process well and adopt a pragmatic approach in implementing the scheme.

“This will help us avoid negative impact on industrial relations and possible disruption to continuity of work that may arise from the hasty implementation of a disputed process,” Mugo said.

Rather than going by the letter of the law, Mugo called for a new spirit to ensure the scheme succeeds.

“Pushing for immediate collection of contributions when the system is not yet in place for the intended beneficiaries to enjoy them, is simply not right,” she said.

At the same time, she said it would be prudent for NHIF to re-engage key stakeholders and iron out contentious issues to ensure industrial peace.

Mugo urged NHIF to put in place checks and balances to improve provision of services in participating hospitals.

“Indeed, one key issue is that NHIF has not yet signed service contracts with private hospitals and other medical institutions to provide the enhanced cover envisaged even as demand for payment of the enhanced contributions is demanded,” she noted.

She said before the roll out, NHIF should harmonise the recruitment of its service providers and prepare clear guidelines.

These guidelines, she added, should address the many questions arising on the actual operations of the scheme.

beneficiaries

They should also educate the beneficiaries on how to access the services before taking money from the contributors.

She said the transferability of service benefits from one region to another should be put in place as a priority and there should be a guarantee of adequate health care provision to all the contributors regardless of their location. 　

In the new scheme NHIF says it expects employers to remit the increased contribution rates beginning September as earlier scheduled.

Under the new rules, NHIF has moved away from the Sh320 maximum contribution to a progressive rate of up to Sh2,000.

The lowest contributor will pay Sh150, which applies, to those earning less than Sh6,000, while the highest contributor will fork out Sh2,000 for those earning more than Sh100,000.