Duale puts 38 counties on the spot over delayed SHA payments
Health Cabinet Secretary Aden Duale.
What you need to know:
- Mr Duale said the ministry is engaging each non-compliant county directly to close the gaps.
- Delays in remittance often spark backlash, especially when employees cannot access health services at facilities.
Thirty-eight of Kenya's 47 counties have failed to remit statutory Social Health Authority (SHA) deductions on time, leaving a combined exposure of Sh432.8 million in unpaid contributions and penalties.
Health Cabinet Secretary Aden Duale disclosed this at the Intergovernmental Budget and Economic Council (IBEC) meeting, held in a special session to review resolutions from this year's Health Summit.
He told the council that only nine counties, or 19.1 per cent of those assessed, are complying with the legal requirement to remit SHA deductions by the ninth of every month.
The outstanding balance is Sh419 million in unremitted contributions and Sh13.6 million in accrued penalties. The national payment rate for July stood at 63.8 per cent.
Mr Duale said the ministry is engaging each non-compliant county directly to close the gaps. Delays in remittance often spark backlash, especially when employees cannot access health services at facilities.
"The obligation to remit SHA contributions by the ninth of every month is a matter that has been settled in law. It's not something that people have a choice," the CS said, citing Section 27 of the Social Health Insurance Act, 2023, and Regulations 17 and 22 of the Social Health Insurance General Regulations, 2024.
He warned that late remittance attracts a monthly penalty under Section 27(6) of the Act, while failure to remit altogether constitutes a criminal offence under Section 48.
The disclosure comes amid proposals by government workers and public servants to push the remittance date to the 25th, in line with salary payments. Healthcare workers have been facing frequent, temporary suspensions of their medical cover, as the National Treasury often delays payroll disbursements to counties and ministries.
This makes it hard for public employers to meet the strict ninth-day deadline, leaving workers unable to access healthcare services.
Duale confirmed the proposal remains under discussion but has not been formalised or gazetted.
"Effecting such a change will require an amendment to Regulations 17 and 22 of the Social Health Insurance General Regulations 2024. And these are the powers conferred by Section 50 of the SHA Act 2023. Given the constitutional history surrounding these regulations, the process will most likely require public participation. So, from MOH, that suggestion to transfer the ninth of every month to the 25th will face a very serious legal challenge," said the CS.
The Social Health Authority building in Nairobi.
The Ministry of Health (MoH) opposes the shift, he said, warning it would break alignment with other statutory deductions, including NSSF, PAYE and the affordable housing levy, and complicate reconciliation across payroll systems.
However, the Kenya Medical Practitioners, Pharmacists and Dentists Union (KMPDU), following a high-level consultative meeting with the ministry in July, had earlier announced that "recognising the importance of uninterrupted access to healthcare for health workers, the government agreed to extend the Social Health Authority (SHA) remittance compliance deadline from the ninth to the 25th of every month."
The union said the adjustment is "expected to significantly reduce disruptions to healthcare workers' medical insurance coverage."
Duale, however, maintains that extending the period employers can hold deducted funds before remitting them would complicate reconciliation across the statutory framework.
"We will be very happy if a formula is found where all SHA remittances by both the national and county governments are done before the ninth. Our system, again, is automatic. You pay your SHA premiums, and within one second, you get an SMS confirming you are now covered by the Social Health Insurance Fund. So, by midnight on the ninth of every month, everybody, including myself, gets locked out of the system if that payment hasn't been made," he said.
Counties and the ministry are now proposing a memorandum of understanding to allow counties to remit by the 20th, a move meant to bypass the current law, which would otherwise require public participation and involvement of the National Assembly.
The Daily Nation reached out to SHA Chief Executive Officer Dr Mercy Mwangangi for the list of compliant and non-compliant counties but had not received a response by the time of this story's publication.
The session also took up the stalled transition of 7,786 Universal Health Coverage (UHC) workers to permanent and pensionable terms.
A Sh8.6 billion allocation for the transition, approved by the Commission on Revenue Allocation, has been held up after the CoG declined to integrate the workers into county payrolls, asking instead that the funds be channelled through the Division of Revenue Act.
The MoH has paid the affected workers for July and August but told the council it will run out of resources to pay them in September unless the funds are released. The National Treasury has recommended the allocation remain under its current classification this financial year to avoid disbursement delays, deferring reclassification to the next one.
"These workers were recruited in 2020 by MoH in cooperation with the Public Service Commission. At the recruitment, the workers were paid a monthly stipend of 40,000 for certificate holders and 50,000 for diploma holders. Then, effective September 2027, the enumeration of the UHC workers was aligned to the Salaries and Commissions Commission salaries and allowances rates. Then, on the 4th of September 2025, His Excellency the President directed that UHC staff on contract be transitioned to a permanent and pensionable basis effective at the end of September 2025," narrated the CS.
The 12th National and County Coordinating Summit, chaired by President William Ruto on January 9, 2026, resolved that the costs of transitioning the UHC workers be factored into the 2026/2027 Division of Revenue, Duale told the council.
The Commission on Revenue Allocation allocated Sh8.6 billion, inclusive of the statutory employer contribution, to fund the transition of the 7,786 UHC staff. The Public Service Commission extended their contracts to June 30, 2026, to see the financial year through, intending to transition them to county governments effective July 1, 2026. A multi-agency committee was formed in June 2026 to oversee the process.
Social Health Authority signage at Mutuini Hospital in Dagoretti South Sub-County, Nairobi, on August 27, 2025.
The MoH then began the central transfer of UHC staff from the national payroll to county payrolls, in collaboration with the Ministry of Public Service and Human Development, effective July 1, 2026. But the process quickly ran into difficulties.
"The payroll transfer was unsuccessful because the migrated payroll was not received for integration into the county payroll system. The Council of Governors subsequently declined to integrate the UHC staff into county payrolls, requesting instead that the allocated funds be channelled through the Division of Revenue Act (Dora)," said the CS.
"To avert a disruption in salaries and a possible strike by the affected workers, the Ministry of Health reversed the payroll transfer and placed the staff on permanent and pensionable terms pending resolution of the matter, allowing salary processing to continue through July 2026. So, for July and August, the Health PS for Medical Services, Dr Ouma Oluga, has paid the UHC staff. But we will not be in a position to pay September because we don't have the resources. So, in September we are going to have a problem unless the whole amount that was put in the conditional grant is transferred to the Ministry of Health and also to Medical Services," said Duale.
However, Wajir County Governor Ahmed Abdullahi, vice-chairperson of the CoG, explained that the challenge lies in a mismatch between the terms counties want to give UHC workers, which are permanent and pensionable, and the mode of financing availed by the Treasury, which is conditional granting year by year.
"The challenge is also that this happened at the time of emergency, and the recruitment itself was not equitable from the division of revenue allocation perspective. There will be counties that gain and others that lose because the recruitment itself was not equitable. This is one thing that has pitted governors against each other. It has also caused misunderstandings between governors and the Ministry of Health. During the summit, we had said, let us just bite the bullet and put this in Dora, but that wasn't done, and then subsequent communication from Treasury was that they want to continue conditional granting of funding," said Mr Abdullahi.
"The continued management of the payroll from the national level also brings in supervision and review issues in the counties. Because when these people know that their payroll is being managed from up there, there is a lot of absenteeism, and sometimes you would probably think there are elements that don't want to do the work and are always being in the streets despite being paid what they ought to be paid. In spite of the contract issues, they are actually being paid the rates of everyone else now; the only problem is the mismatch between the funding and the terms of the contract. I am hoping we will find a solution to that one," he added.
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