THE Ministry of Health will re-categorise all hospitals before they are empanelled by the Social Health Insurance Fund (SHIF) in a bid to eliminate fraud that has seen taxpayers lose millions of shillings through fictitious claims against the National Health Insurance Fund (NHIF).
Health Cabinet Secretary Susan Nakhumicha said the Kenya Medical Practitioners and Dentist Council (KMPDC) will be the only body to inspect and categorise all levels of hospitals before they are contracted by SHIF.
She told the National Assembly's health committee that several hospitals have been contracted by the NHIF at levels they should not be and are therefore claiming money from the NHIF at rates they are not entitled to.
"We have found that there are hospitals that are categorised as level 4 when they are actually level 2," said Ms Nakhumicha.
"Under the new Social Health Authority (SHA) Act, the KMPDC will be the lead agency that will inspect, categorise and license the hospitals before they are on boarded by the SHIF for payment of claims. This will address the issue of fraud.
The Health Act has six categories of hospitals, with level 1 being community facilities run by certified medical clinical officers, level 2 (health facilities), level 3 (health centers), level 4 (district hospitals), level 5 (district referral hospitals) and level 6 (national referral hospital).
Ms Nakhumicha told the committee that it is investigating fraudulent claims by a number of hospitals that NHIF has paid out millions of shillings due to fraud.
She said between July 2022 and December 2023, an internal audit directorate conducted investigations on 31 health care providers and found that there were breaches of contractual obligations.
The CS said the reports have been prepared and submitted to the audit committee of the NHIF board, but the full board is yet to approve the recommendations.
"Some of the recommendations were to refund fraudulent claims paid, stop payment on claims in process and for the board to make a decision on the fate of the affected healthcare providers in line with clause 16.6 of the contracts, whether to suspend the healthcare providers or terminate the contract," Ms Nakhumicha said.
"In view of the transition of the National Health Insurance Fund to the Social Health Authority (SHA), the NHIF Board has not met to deliberate on the reports."
Ms Nakhumicha told the committee, chaired by Endebess MP Robert Pukose, that the Attorney General had issued an advice that during the transition period, the NHIF board should only deal with the winding up of the fund and not any other matter.
"This matter is therefore left to the SHA board to deliberate on and give direction and way forward to the affected healthcare providers," Ms Nakhumicha said.
Health Principal Secretary Harry Kimtai said no hospital will be empaneled by the SHA without clearance from the KMPDC.
"In case of fraud, the KMPDC will be held accountable under the new law. Before, no one was held accountable for fraud. The SHA brings accountability," said Mr Kimtai.
The committee, which concluded its probe Wednesday, investigated how several healthcare providers colluded with NHIF officials to fleece the national insurer of millions of shillings.
NHIF chief executive officer Elijah Wachira told the committee that Beirut Pharmacy and Medical Center submitted a total of 1,706 claims between January 2022 and June 2023, of which 1,592 were paid amounting to Sh153.43 million.
"Monitoring conducted at the sampled employers revealed that 26 employees of Employer A were confirmed by the employer to have been at work throughout the period of admission," said Mr Wachira.
"As a result, 3.65 million in paid claims were fraudulent. Beirut Pharmacy and Medical Center should repay Sh15.49 million paid on fraudulent claims and 114 claims totaling Sh13.19 million should be rejected."
Mr Wachira said the results of the investigation into Amal Hospital showed that it submitted 504 claims, of which 267 worth Sh34.65 million were paid. He said 237 claims worth Sh32.25 million were stopped by the investigations.
He said seven employees of one employer were found to have been at work at the time the hospital claimed admission resulting in a loss of Sh910,000.
Mr Wachira said the audit committee recommended that Amal Hospital should pay NHIF Sh7.6 million and the claims totaling Sh32.25 million be rejected.
He said they also recommended that Joy Nursing and Maternity Hospital reimburse NHIF Sh73.96 million.
