Without insurance, quality healthcare is out of reach

By Jackson Okoth

Mr John Ochieng, 22, roams the streets of Nairobi selling audio and video cassettes.

When he was 20, his father became seriously ill.

Ochieng, the oldest child, was compelled to quit school and work to sustain his family and pay for his father’s medical care.

His father belongs to thousands of Kenyans in the informal sector who have no access to quality healthcare due to lack of medical insurance.

He belongs to a category of Kenyans who rely on their extended family for financial support when they fall sick.

The insurance industry has been slow in coming up with micro-insurance products to cater for the likes of Ochieng’s father.

Although there is stiff competition in the medical insurance business, forcing providers to ease access conditions, many are still left out.

Instead, increased demand for medical insurance, spurred by a rise in the cost of medical care, is forcing insurance companies to abandon individual covers for corporate clients.

This shift has exposed individuals, especially those in the low-income retail segments, to financial difficulties in paying for medical care.

Like all other classes, medical insurance still faces challenges of low penetration, poor public perception and the fact that medical insurers are selective on who to insure.

Most medical insurance products available in the market are out of reach to many owing to costly premiums as well as numerous exclusions.

To cushion themselves from rising costs of medical care, most individuals in the low-income segments can only turn to the National Hospital Insurance Fund (NHIF).

NHIF collects contributions from individuals to pay hospital bills for members and their dependants.

Monthly contributions range from Sh30 for those earning between Sh1,000 and Sh1,499 to Sh320 for those with income exceeding Sh 15,000. Voluntary and self-employed persons contribute Sh 160 a month.

Spouse and children

The fund provides comprehensive medical cover in public hospitals as well as accredited private medical facilities. It provides an inpatient cover of up to Sh396,000 a year for the contributor, spouse and children.

NHIF does not exclude any disease and covers maternity cases.

A member cannot make a claim from hospitals not accredited by NHIF. But one can lodge a Foreign General Claim if treated outside Kenya.

Unlike NHIF, insurance companies providing medical covers offer in-patient covers designed for corporate clients.

The benefits offered include cover for illness and accident hospitalisation, including hospital accommodation charges, surgeons’, anesthetists’ and physicians’ fees, operating theatre as well as high dependency and intensive care unit fees.

The low-income segments of the population remain uninsured because insurers have been reluctant to move into this market, citing the low margins.

As a result, medical insurance remains the preserve of the upper middle and high-income segments of the population.