The good, the bad and SHA: Hits and misses of Kenya’s universal healthcare plan, one year on

Ms Margaret Wanjiku cradles her newborn daughter, tears of relief streaming down her face. Thanks to SHA, her complicated delivery—which led to an emergency caesarean section that would have cost Sh300, 000 under the old system—was covered entirely.

"I thought I would lose my baby and go into debt for life," she whispers. "SHA saved us both. All I had been hearing was that the system only works for those in power. I didn't know anyone, but it cleared my bills."

Similarly, Mr Brian Kipchoge is undergoing chemotherapy for leukaemia. Under the National Health Insurance Fund (NHIF), the family couldn't exceed their limit. Under SHA, the entire treatment is covered.

Mr Samson Waweru, who had an accident last week, also had SHA pay his hospital bill and the prosthetic he needed.

Yet barely metres away, Mr James Mutua clutches a creased prescription he cannot afford to fill. The mechanic from Kibera has been locked out of SHA since the transition began, unable to navigate the means-testing system designed to determine his contributions. The system is unable to pay any of his hospital bills.

"NHIF was simpler," he says bitterly. "Now I'm back to paying cash for everything."

When SHA launched, replacing the National Hospital Insurance Fund, the government promised universal healthcare coverage that would protect all Kenyans from catastrophic medical expenses. Eighteen months later, statistics reveal a system struggling to live up to its promises.

Of the 25 million Kenyans registered in the system, only 4.5 million have completed the means testing process designed to determine their contributions—and not all are remitting their monthly payments. More damning still, fewer than one million are paying their determined premiums, a participation rate that would make any insurance executive break into cold sweats.

In July alone, SHA data available to health providers show that out of the 25 million registered under the system, 70,793 formal sector workers paying the 2.75 per cent monthly contributions contributed Sh5.9 billion of the Sh6.7 billion collected by the authority.

Sh780 million

Meanwhile, 187,727 informal sector members, from a pool of 16.7 million eligible workers, managed only Sh780 million in contributions—a participation rate that reveals the depth of the system's challenges.

The informal sector's failure to remit contributions tells an even more troubling story. NHIF had successfully enrolled 1.8 million informal workers by 2022.

Today, SHA counts barely 900,000 — a 50 per cent decline representing hundreds of thousands of Kenyans who have chosen to opt out entirely.

"NHIF took Sh500 from my monthly earnings. SHA wants Sh6,000 based on some calculation I don't understand. Where will I get that money when I don't work every day?" Mr Peter Otieno, a construction worker from Kisumu, asks.

But Dr Ouma Oluga, the Medical Services Principal Secretary, rejects any comparison to NHIF.

“Comparing NHIF to SHA, it is a success story that requires more advocacy and more campaigns,” he says.

The other elephant in the room for the programme is the means-testing system, borrowed from social protection programmes in other countries, which was supposed to ensure fair contributions based on the ability to pay. Instead, it has become a bureaucratic nightmare that has driven away the very people it was meant to help.

According to health experts, the means testing has failed since the SHA is no longer using the gazetted mathematical formula to determine contributions from the self-employed and informal sector.

Read:  Patients turned away as private hospitals blacklist SHA over debts 

"In a country where joblessness is rampant and movement into and out of poverty is very fluid, the means-testing system should not have been part of the Social Health Insurance Fund (SHIF) contributions design. We warned the proponents of this error, but unfortunately, they ignored the advice of many experts. I wish they had taken our advice," said Dr Brian Lishenga, chairman of the Rural Urban Private Hospitals Association.

According to him, the mathematical formula used to determine contributions has proven so complex and disconnected from reality that SHA has quietly abandoned its use, though officials are reluctant to admit this publicly. The result is a system where contribution levels seem arbitrary, creating resentment amongst those who feel unfairly assessed, whilst leaving the authority without the revenue it needs to function.

But Dr Oluga also rejects this — saying the means testing system is still in place.

“All Kenyans currently enjoying services have gone through the system. The challenge is in the proper community sensitisation of its utility. The system promises to ensure equity for all those who will contribute to SHIF as it calculates contributions based on economic status rather than flat rate figures,” he says.

Similarly, the transition from NHIF to SHA has been characterised by what healthcare providers describe as a "cold war" between the new authority and the medical facilities it depends on to deliver care.

At the heart of the conflict lies SHA's refusal to acknowledge NHIF's legacy debts as its responsibility, despite clear legal provisions in the Social Health Insurance Act. Healthcare providers, owed billions by NHIF, find themselves in an impossible position: continue serving SHA patients without a guarantee of payment, or risk being labelled as blocking access to care.

"We're told SHA is different from NHIF, so they won't pay NHIF debts. But we're also told we must accept SHA patients or lose our contracts. How do we pay staff and buy supplies when we're owed Sh15 million from the old system and uncertain about payments from the new one?" Dr Anastasia Nyong*, who runs a mid-level private hospital in Nakuru, says of the dilemma.

Read: Pain for patients as SHIF roll-out crisis deepens

This standoff has practical consequences for patients. Many private facilities have quietly reduced their SHA patient load, creating longer waiting times and reduced access to care, particularly in rural areas where private providers often fill gaps in public health infrastructure.

Dr Vitalis Ogolla, a dentist and former NHIF service provider, sharply criticised the Sh104 billion spent on the new ICT system.

"This was enough to build about six new referral hospitals across the country. This is enough to tell you that this project was for a few who are out to make money and not for the benefit of Kenyans. They should be ashamed."

Despite the billions spent on the system, issues of fraud—which were the main reason for creating the new system—still plague SHA, he said.

Dr Lishenga agrees, citing a proposal they had made for a two-year transition period, which he said was brushed off.

Another challenge that health experts mentioned could lead to the authority's downfall is the introduction of free primary healthcare without a mandate for contributions.

"Free primary healthcare is one of the chief reasons SHA is collecting less money than NHIF. While the intent may have been noble, the adverse effect is that it has demotivated the populace from making contributions. 90 per cent of all hospital visits are outpatient. If all that is needed to access 90 per cent of your medical needs is 'registration', why would you contribute? In addition, if upon a single contribution you immediately access all benefits, why not just wait until you need care? This is a major design flaw in SHA," Dr Lishenga said.

In SHA’s defence, Dr Oluga said the authority is collecting twice what NHIF collected. The benefit package is also twice as good and more generous. In eight months, SHA has paid out Sh50 billion, which NHIF used to pay out in a year, he says, with Sh13 billion to primary health.

But perhaps no aspect of SHA’s implementation has been more controversial than what critics describe as the "weaponisation" of the Kenya Medical Practitioners and Dentists Council (KMPDC) against private healthcare providers.

Through a series of facility downgrades, bed capacity reductions, and stringent new staffing requirements, the Ministry of Health has systematically reduced the private sector's role in SHA.

The consequences are particularly severe in rural areas where private facilities often provide the only accessible healthcare. Many Level 3 facilities in remote parts of Kenya can no longer conduct deliveries because KMPDC has erased their observation and emergency treatment rooms from the SHA portal, forcing pregnant women to travel hours to reach the nearest public facility.

"We've served this community for 15 years. Now, SHA tells us we can't deliver babies because we don't have a full-time anaesthesiologist. The nearest government hospital is 80 kilometres away on roads that become impassable during rain. Are we supposed to let mothers die for the sake of bureaucratic requirements?" says Dr Victor Ng'ani, who runs a small hospital in Taita Taveta.

But Dr Oluga rejects this accusation.

“MoH has simply taken up its mandate in maintaining policy oversight on the quality of care. And we shall ensure that the famous Mugo Wa Wairimu and all fraudulent health services never exist again. The patient will be the boss,” Dr Oluga said.

Read:  Doctors speak out on SHIF mess, patients’ agony  

The Ministry of Health defends these moves as necessary quality improvements; however, the result has been reduced access to care in underserved areas.

"Although its rollout to all hospitals has been delayed and funding is still below par, the hospitals already implementing this have seen a change. This fund promises to be one of the shining stars of the reform," said Dr Davji Attelah, Secretary General of the Kenya Medical Practitioners and Dentists Union.

Beyond individual success stories, SHA's technological infrastructure is beginning to deliver on some of its promises. The shift to electronic contracting has eliminated the corruption and inefficiency of manual contracts that plagued NHIF. Remote facilities can now be onboarded within days rather than months, expanding coverage to previously unreachable areas.

The Health Information Exchange (HIE), a centralised system that consolidates medical registries, is starting to unleash the power of big data for health system planning. Early results show improvements in fraud detection and claim processing times.

"The technology foundation SHA is building will serve Kenya for decades," argues Dr Mercy Mwangangi, chief executive of SHA.

"Yes, the transition has been painful, but we're creating a system that can evolve with changing health needs rather than being trapped by legacy infrastructure."

"We know there are teething problems. When we fully implement the system, Kenyans will appreciate what we are trying to do. It is just a matter of time, and all will be well."

Read: Healthcare reforms suffer setback as SHA performance declines

Perhaps SHA's most unexpected success has been in public engagement. The transition, despite its problems, has generated the most robust healthcare debate in the country's history. Kenyans who once viewed health insurance as a distant government programme now actively discuss contribution levels, benefit packages, and service quality.

Monthly town halls in counties across Kenya draw hundreds of participants asking pointed questions about SHA's performance.

Social media groups dedicated to SHA experiences have become forums for both criticism and advocacy. The authority that was supposed to quietly replace NHIF has instead sparked a national conversation about the kind of healthcare system Kenya wants and can afford.

Universal health coverage

How other countries achieved universal health coverage success

As Kenya grapples with SHA's implementation challenges, several countries offer valuable lessons on building sustainable universal health coverage systems.

Thailand in 2002, implemented the Universal Coverage Scheme (UCS), achieving 99 per cent population coverage. Without relying on member contributions, it used general taxation, focused on building health infrastructure at the district level and trained the health workforce.

It also built health infrastructure for over years before implementing UHC.

Thailand concentrated on a strong primary care gatekeeping system with comprehensive benefit packages.

Rwanda achieved 80 per cent coverage through Community-Based Health Insurance (CBHI), used a community-based assessment system to determine socioeconomic categories and premiums.

It made insurance compulsory with actual penalties for non-payment, and built upon and improved existing systems without replacing what they already had.

Ghana reached 38 per cent nationwide coverage from 2004-2015, started with Community-Based Health Insurance Schemes before scaling up nationally.