The government, through the National Health Insurance Fund (NHIF), lost Sh171 million in a year to fraudulent claims by hospitals contracted by the fund.
In a shocking revelation, Health Cabinet Secretary Susan Nakhumicha said on Friday that out of the 67 hospitals audited between the months of January and December, 27 health facilities were involved in fraudulent activities.
The extent of the fraud, the CS said, could have resulted in losses of more than Sh20 billion as it is estimated that about 3,440 out of a total of 8,886 or about 40 per cent of the hospitals pocketed money from NHIF through fictitious claims.
Last month, a report presented by NHIF Chief Executive Officer Elijah Wachira to the National Assembly's Public Accounts Committee exposed the many strategies used by hospitals across the country to siphon money from the NHIF.
The report detailed how some hospitals billed the NHIF for services never rendered, while others used unscrupulous means such as manipulating MRI images to include patients who did not actually receive the services.
"Under the EduAfya cover, health facilities have lured healthy students by offering food incentives for their biometrics, resulting in huge financial losses. In addition, cases of nurses stationed in schools collecting biometrics of non-ill students to submit fictitious claims have been unearthed, significantly abusing the scheme," she disclosed.
Activating members' dormant accounts
Other strategies included activating members' dormant accounts to fund medically unnecessary treatment. Some healthcare facilities also kept fictitious records, fabricated claims and engaged in deceptive practices, such as falsely reporting that members had undergone major surgery while actively working, all of which contributed to the fraud.
"Disturbingly, some hospitals have targeted groups of security guards from licensed security companies and financially induced them to provide biometric data for fraudulent purposes," she added.
Health Cabinet Secretary Susan Nakhumicha (centre) addresses journalists at Afya House in Nairobi on January 5, 2024. She is flanked by Principal Secretary (PS) for Medical Services Harry Kimtai and his Public Health and Professional Standards counterpart, Mary Muriuki.
Photo credit: Billy Ogada | Nation Media Group
Anomalies were also found, including facilities performing an unusually high number of eye surgeries in a day, ranging from 10 to 22, in facilities with a capacity of only two per day, without adequate operating theatre capacity.
The fraud also targeted vulnerable people such as the elderly living in regions such as Nairobi, Meru, Nyahururu, Muranga, Kerugoya, Makueni, Tharaka Nithi, Subukia, Nanyuki, Bungoma, Chuka and Machakos.
The identified facilities, CS said, have been suspended and recovery of fraudulent claims is ongoing.
These revelations come three months after the enactment of the Social Health Insurance Act, which abolished the NHIF and established three new funds: The Primary Healthcare Fund, the Social Health Insurance Fund and the Chronic Illness and Emergency Fund.
Commenting on the gazette, Ms Nakhumicha said the new funds pave the way for a new way of financing healthcare.
"It is a shift from merely treating illness to actively promoting wellness in communities, bringing healthcare closer to home by creating a network of healthcare support that extends from basic community facilities to advanced medical centres," she said in November.
According to the CS, secondary school students from public schools, who were previously covered by the Edu-Afya programme, will be included in the new fund under their families.
'Everybody will be covered'
"What we have done under the Social Health Authority, we have said that the government is not going to leave anyone behind. Everybody will be covered. Because what they did was they covered students and they forgot that students come from families and they depend on their parents. So what the Health and Human Services is going to do is cover the household, which includes the students," she said.
However, the court temporarily halted the implementation of the scheme after the Kenya Medical Practitioners, Pharmacists and Dentists Union (KMPDU) filed a case challenging the implementation of the social health insurance scheme.
The roll-out was due to take place this month, in January 2024, as required by law.
"We will start our registration in earnest as soon as our issues are resolved by the courts. We will be registering households, so everyone in our household will be covered. The students, the parents and all the members of the household will be covered," she said.
