New health insurance stirs controversy

Kenya's controversial shift from the National Health Insurance Fund (NHIF) to the Social Health Insurance Fund (SHIF) came into effect yesterday amid concerns that Kenyans were not ready for the switch, and that the government did not have adequate funds for the programme. The Standard reports that the Kenya Union of Clinical Officers, through its secretary-general George Gibore, said the government should have taken more time to look at the transitioning process considering the financial constraints and infrastructure of hospitals. Medical Services Health principal secretary Harry Kimtai said registration to the new scheme was a must for all Kenyans. Kimtai insisted that the Social Health Insurance Act, under which the SHIF falls, would serve all Kenyans unlike NHIF, which, he said, was discriminatory and mostly favoured the employed. Presidential adviser on health Daniel Mwai said healthcare financing has been a major challenge in the country, an area that has been corrected under the Act. Mwai said the system was an improvement informed by past systemic failures. NHIF, according to Mwai, heavily targeted 20% of Kenyans in formal employment, leaving out 80% in the informal sector, who are now all included in the new scheme. In the new scheme, deductions have been capped at 2.75%, with low-income earners paying less compared to NHIF.

An Ernst & Young summary notes that the Social Health Insurance Act, Primary Health Care Act and Digital Health Act came into operation on 22 November 2023, followed by the gazettement of the Social Health Insurance Regulations on 8 March 2024 to operationalise the Primary Healthcare Fund, the SHIF and the Emergency, Chronic and Critical Illness Fund. The regulations required every person resident in Kenya to register with the Social Health Authority before 30 June 2024. Employers' deduction and remittance of contributions was expected to commence on 1 July 2024. However, implementation of the requirements faced challenges, leading to a postponement of the kick-off date. This was after the High Court declared the Acts unconstitutional, but the Court of Appeal stayed application of the High Court decision, pending the determination of the substantive appeal. Therefore, employers must comply with the extended 1 October 2024 effective date. Failure to contribute will result in penalties.