NHIF on the spot over cancellation of tenders

The National Hospital Insurance Fund (NHIF) offices in Nairobi. [Standard, file]

The National Hospital Insurance Fund (NHIF) is under scrutiny following the cancellation of numerous tenders in an unclear circumstances, raising concerns among bidders.

Acting NHIF CEO Samson Kuhora is alleged to have canceled the tenders after the submission of the relevant documents, which bidders claim goes against procurement procedures.

Following the new development, the bidders have challenged the decision and have received legal advice from the Public Procurement Regulatory Authority (PPRA) with reference number PPRA/5/50/VOL.IV (19).

In the advisory, PPRA has directed NHIF to issue addendums, which are attachments to a contract that modify the terms and conditions of the original contract.

Addendums are used to efficiently update the terms or conditions of many types of contracts.

"A bidder stated, 'NHIF issued the tenders on May 30, 2023, with prospective bidders having until June 14, 2023, to submit their bids. The CEO is said to have canceled the tenders a day earlier, and it was not uploaded on the Public Procurement Information Portal as stipulated by law," said a bidder.

The bidders claim that Kuhora advertised the cancellation in My Gov magazine six days after the cancellation, and it was only on June 20, when an online message cited section 63 (1) (e) of the Public Procurement and Asset Disposal Act.

They have vowed to challenge the decision to cancel the tenders in court, stating that NHIF had no valid reason for doing so.

They argue that the management must provide an explanation for bypassing the established procedures.

The bidders expressed concern that cartels may have influenced the cancellation of the tenders without following due process.

They also mentioned that NHIF has demoted some staff and promoted others in connection to the cancellation of the tenders.

"Some NHIF staff fear they could be targets of the cartels working with personalities in management. There are fears that there could be a scheme to interfere with the tendering process and documents to favor cartels, which caused the last-minute cancellation,'" said a bidder.

The canceled tenders include Tender No. NHIF/033/2022-23 for the provision of insurance brokerage services, Tender No. NHIF/036/2022-23 for the provision of co-insurance and facultative insurance services for group life and final expense insurance services for civil servants and employees of the National Youth Service, and Tender No. NHIF/037/2022-23 for the provision of emergency road evacuation services.

Kuhora has acknowledged errors in the tendering process and has promised to take necessary action to rectify the situation.

He also vowed to take disciplinary action against staff members who made mistakes during the tendering process.

"The National Hospital Insurance Fund will seek advice from the Public Procurement Regulatory Authority on the way forward and will conduct an internal review of our procurement procedures," said Kuhora.

NHIF has in recent times faced criticism over questionable transactions with various hospitals, leading to the loss of millions of contributors' money.

Health Cabinet Secretary Susan Nakhumicha has ordered investigations into the matter.

Nakhumicha has already suspended NHIF branch managers in certain areas of the country after the media exposed how unscrupulous hospitals stole millions of shillings through suspect medical camps targeting elderly patients.

She has also ordered a comprehensive lifestyle audit of NHIF staff.

The Senate Health Committee is conducting an inquiry into allegations of embezzlement of funds in NHIF and questionable claims by various health facilities across the country.

Nominated Senator Esther Okenyuri has requested a statement on measures taken to recover the lost NHIF money.

"The Committee should recommend investigations into claims of siphoning of funds in dubious claims by beneficiary health facilities across the country, shedding light on reports of collusion with NHIF staff and directors of such facilities," stated Okenyuri.

Okenyuri seeks to have the committee provide information on the number of health facilities accredited by the NHIF per year, per county in the past four years (2019-2023) compared to the preceding years (2014-2018).

She is also seeking a statement from the Senate Health Committee on the abnormal rise in the accreditation of new clinics and health facilities across the country by the NHIF Board after the rollout of the Universal Health Coverage program.

The Kenya Medical Practitioners and Dentists Council (KMPDC) has suspended all eight medical facilities identified by the Health Cabinet Secretary as having allegedly siphoned funds from the NHIF.

NHIF Board Chairman Michael Kamau, who assumed his position in December last year, has pledged to clean up the mess within the government agency.

He plans to start by recruiting a Chief Executive Officer and appointing substantive heads in many departments, which are currently being led by acting officers.

"The loss of public funds at the National Hospital Insurance Fund in the past has left helpless patients who cannot access private facilities suffering. That will not be allowed to happen under my watch. We are currently busy putting things in order behind the scenes," said Kamau.