One Year SHIF Will Collapse? What Hospitals are Warning About

Health Cabinet Secretary Deborah Barasa, with Kenyatta National Hospital CEO Dr Evanson Kamuri, interacting with a mother at the hospital, January 16, 2025. Photo MoH

Several hospitals stated on Tuesday, March 4th that the Social Health Insurance Fund (SHIF) is likely to collapse within the next year, 2026.

They believe that the present challenges are preventing the system from being effective, and if not addressed, it will lead to the downfall of President Ruto's program.

Hospitals affiliated with the Kenya Healthcare Federation (KHF), Rural Urban Private Hospital Association (RUPHA), Kenya Association of Private Hospitals (KAPH), and faith-based hospitals informed lawmakers that without increased funding, the primary healthcare fund will not remain sustainable.

KHF chairman Kanyenje Gakombe expressed regret that non-salaried Kenyans tend to contribute to SHIF only when they fall ill and need hospital services, and after receiving treatment, they do not continue making contributions to the fund. 

“If we do not address how non-salaried people should make their contributions because they only pay when they fall sick, this SHIF will become very untenable,”KHF chairman Kanyenje Gakombe.

Photo Collage of CS Barasa and SHA logo : Photo courtesy

The primary healthcare fund manages outpatient services, which cater to 91 percent of all Kenyans.

The hospitals additionally expressed worries that the Sh900 annual capitation allocated to families for outpatient services is insufficient compared to the previous capping under the now-defunct National Hospital Insurance Fund (NHIF), which was Sh1,000 allocated for Level I and Level II hospitals.

Eric Musau, the chairperson of KAPH, expressed concerns about the fund's sustainability.

“More than 80 per cent of those living in the informal sector are registering as members, they have done that 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 12 months,”KAPH, Eric Musau.

RUPHA chairperson Brian Lishenga stated that the fund has become very unpopular, with its highest rating according to a recent survey being 37 percent.

“Out of 20 million registered persons only about four 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 12 months because even the funding the vote was allocated is Sh4.2 billion to cover 20 million Kenyans yet the budget required is Sh18billion,” RUPHA chairperson Brian Lishenga.

The hospitals' sentiments were expressed on the same day that 10 lawmakers allied with Gachagua urged Ruto to acknowledge that he was involved in an irregular transaction when acquiring the SHA system.

This follows Auditor General Nancy Gathungu's statement on Monday, March 3rd, indicating that the state spent Sh104 billion on acquiring a system it neither owns nor controls.

On Tuesday, March 4th, President William Ruto denied allegations that his administration had allocated Sh104 billion for the acquisition of an Integrated Healthcare Information Technology System.

President William Ruto during the burial of late Malava MP, Malulu Injendi: Photo: Screengrab

"They think we are fools? There is no government money that will be used to pay for any system because we want to sort out the problem of the fraud of the past.

"A lot of money that was being collected by NHIF used to be stolen by brokers and crooks who used to pretend they have hospitals through fake claims, fraudulent claims and consumed almost 40 percent of the money that was being raised by NHIF and that shall never happen again when I am still the President."