Police have arrested Athi River's Shalom Hospital administrator following a viral video of a woman giving birth at the reception as nurses watched.
An investigative team made up of national and county government officials visited the facility on Monday.
They found alarming abuse of procedures, substandard operations and wanting treatment of patients.
The interrogation also revealed Shalom Hospital lacked appropriate supervision and the Accidents and Emergency Unit did not meet the minimum requirements.
A joint clinical audit will be conducted on Tuesday on staffing and available services.
The board will make the final decision based on the audit findings within a month.
If found culpable, all Shalom hospitals in the county risk losing licences.
Machakos Governor Alfred Mutua said the hospital will be investigated and risks closure.
He invited Directorate of Criminal Investigations detectives to charge the directors and owners of the facility with criminal negligence and other crimes.
"This is totally unacceptable and will not be allowed in Machakos County," Mutua said in a statement.
Following a seven-hour investigation, Mutua ordered that casualty nurse John Ndege's licence be withdrawn for three months.
He is required to undergo retraining at Kenyatta National Hospital.
Investigations revealed nurse Edna Nyarangi is not registered. She was arrested, awaiting prosecution.
Hospital administrator Thomas Ndolo was also arrested for violating the law.
Samuel Ongoya was reprimanded as Kelvin Samita was ordered to seek mentorship at Machakos Level 5 Hospital for a month.
Dr Mutembei Itunga was reprimanded for failing to institute infection prevention control.
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