SHIF: Private hospitals warn system could collapse in 12 months

PS Medical Services, Ministry of Health Harry Kimtai when he appeared before the National Assembly's Health Committee in February 19th,2025. [Elvis Ogina,Standard] Hospitals have warned that the Social Health Insurance Fund (SHIF) could collapse within the next 12 months if funding challenges afflicting its implementation are not addressed. The revelation came on a day that former Deputy President Rigathi Gachagua-allied MPs demanded an explanation on from the government on how it procured the Sh104.8 billion Social Health Authority (SHA) system following revelations by the Auditor General that it was run by private entities. Appearing before the National Assembly committee on Health, hospitals under the Kenya Association of Private Hospitals (KAPH), Kenya Healthcare Federation (KHF), Rural Urban Private Hospital Association (RUPHA), as well as faith-based hospitals told the parliamentary committee that if the funding going to the Primary health care fund is not enhanced then the fund will not be sustainable. The representatives who spoke on behalf of the hospitals also pointed out that the Sh900 capitation allocated to families per year for outpatient services was inadequate and had been a downgrade from the Sh1,000 provided for under the defunct National Hospital Insurance Fund (NHIF) for level one and two hospitals. They further observed that there lacked a centralised and reliable mechanism of ensuring that Kenyans in the informal sector contributed to the fund without fail, and that only a section of those in the informal sector were making their contributions to the fund. KHF chairman Kanyenje Gakombe revealed that whereas the government owed private hospital Sh30 billion in reimbursements, non- salaried Kenyans had not been consistent with their contributions to the fund as they only paid when sick and in need of a service but never continue with contributions afterwards. This, he said, adversely affected the operations of the fund. "The Social Health Insurance Fund will become untenable if a solution is not arrived at on how non- salaried Kenyans should make their contributions to avoid them paying only when sick," said Gakombe. His KAPH counterpart Eric Musau observed that there lacked sufficient safeguards to ensure the much-needed sustenance of the fund. This, he attributed to the fact that only 4 million non-salaried Kenyans, translating to 22 percent of the total registered members, are contributing. "Eighty per cent of those in the informal sector only register as members when they need services. Someone comes to the hospital, pays Sh800, gets a benefit of Sh1.8 million and then after treatment it ends at that. If we do not follow up on this issue, we do not see how this fund will survive beyond twelve months," said Musau. RUPHA chairperson Brian Lishenga said the fund had become unpopular, further pointing out the meagre amounts being collected. "Out of 20 million registered persons only about 4 million people in the informal sector are contributing yet the Primary Health Care is supposed to support even those that are not contributing. This fund can only survive for the next twelve months because the funding the vote was allocated is Sh 4.2 billion to cover 20 million Kenyans yet the budget required is Sh18 billion," added Lishenga. And in a separate but related occurrence, over ten MPs allied to Gachagua pressed the Head of State to put an end to the SHA system and refund Kenyans their monies already deducted from their salaries following revelations by the Auditor General that the system was not owned or controlled by government. Kajiado North MP Onesmus Ngogoyo accused the President of deliberately overseeing the skewed implementation of the system to make sure "he is a beneficiary." Naivasha town MP Jane Kihara called on Ruto to acknowledge that the system had failed, and there was no need of subjecting salaried Kenyans to more pay slip deductions. "The auditor general told us that the government is not answerable to this SHA thing. It is now clear that there is corruption in these SHA things and the money is going to the pockets of a few people. The money is just being taken. Ruto should tell us when he will refund us this money. This is money being deducted using corrupt ways," stated Kihara.

SHIF: Private hospitals warn system could collapse in 12 months

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