The Ministry of Health’s transition committee has advised deferring the implementation of the new SHIF, which is expected to become operational on July 1, citing technical glitches on the digital platform designed for contributions and registrations.
The committee overseeing the Social Health Authority, the entity set up to administer SHIF and eventually replace the National Health Insurance Fund, NHIF, said a dry run on an Information Communication Technology, ICT, system they are to use revealed a high level of unpreparedness. This recommendation comes less than a week to the expected rollout date.
In light of these findings, the Health Ministry has been entreated to retain the current NHIF structure and withdraw already published regulations by SHIF. The committee emphasized that alternative solutions, with a possible recall of SHA regulations, shall be utilized under the current infrastructure provided by NHIF. This move, however, has financial implications, especially on the licenses for NHIF systems and their renewal contracts.
A pilot test in Marsabit revealed a number of readiness issues with the new system. It was felt that a further pilot, including proxy mean testing, would be required by the committee. ICT experts have been tasked to explore alternative solutions for SHA’s registration and contribution system.
The committee was chaired by Dr. Jason Kap-Kirwok and had the mandate to design this fund following its inauguration on January 30, 2024, by Health Cabinet Secretary Susan Nakhumicha. Early in March, Nakhumicha announced that beginning July 1, SHIF would start running, with all contributions mandatory for all above the age of 18, funding Universal Health Coverage.
Under the proposed SHIF contributions, Kenyan workers will in future pay 2.75% against their gross income, significantly improving the deductions from higher earners at a time when the economy is struggling with rising inflation. For example, those earning Sh50,000 would see their deductions go up to Sh1,375, Sh100,000 at Sh2,750, and Sh500,000 at Sh13,750 gross pay if uncapped. Low-income earners, on the other hand, will find some reprieve, with a worker earning Sh20,000 now seeing deductions drop to Sh550 from Sh750 under NHIF. Those without any source of income will also be obliged to pay a minimum of Sh300 per month to SHIF, towards facilitating UHC.
The recommendations made by the SHA Transition Committee have enveloped the feasibility of the launch of SHIF in big question marks, considering that NHIF, which is expected to form the backbone of SHIF, has myriad problems, including owing private hospitals large amounts in unsettled claims. Members of the Rural Private Hospitals Association of Kenya (Rupha) are reportedly over 400 members who have stopped accepting NHIF cards following unsettled claims amounting to over Sh6 billion, greatly affecting their operations.
The cost for the entire ICT system central to the management of payments to healthcare providers by the SHA is at least Sh 5 billion; a few Members of Parliament haveAssignable Asked for SHIF enrolment suspension with immediate effect, citing discontent over how procurement for the whole process is being handled. According to the Health Committee in Parliament, there are suspicious data security risks and probable corruption relating to procurement.
Section 47 of the SHIF limits the application of secure and trusted technology in digitization and processes, applying the Data Protection Act 2019 and other relevant laws. That notwithstanding, non-transparency and non-readiness of the ICT system remain one big challenge. There has also been concerns in the education sector after the government scrapped cover for the secondary school students in public institutions dubbed EduAfya under the NHIF without a proper alternative.
Testing by the Ministry to identify vulnerable households needing financial assistance has yet to begin. Some high earners who had a ceiling of Sh1,700 under NHIF will also go up under SHIF. Non-salaried people who used to pay Sh500 per month under NHIF will now pay Sh300 under SHIF.
