The Social Health Authority of Kenya (SHA) faces a major financial emergency because the organization requires Sh116 billion, which experts believe will disrupt healthcare services across the country and cause delays in hospital and clinic payment processes.
The Institute of Economic Affairs (IEA) Kenya published a new assessment that shows that the authority fails to meet its Universal Health Coverage goals because of serious operational deficiencies and compliance problems and fundamental organizational deficiencies.
The SHA, which established itself as a replacement for the National Health Insurance Fund (NHIF), seeks to provide more people with access to affordable healthcare but currently faces a budget shortage that officials claim will prevent them from making payments to healthcare services across the country. Analysts describe the shortfall as catastrophic, pointing to delayed payments, inadequate digital infrastructure, and pervasive fraud as core drivers of the crisis.
During a media briefing at Nairobi, IEA Programme Coordinator John Mutua explained that the funding deficit occurs because organizations fail to meet compliance requirements, which prevents them from paying NHIF debts and enables system loopholes to be exploited. Mutua warned that these financing pressures are already impacting service delivery and could prompt providers to restrict care or shift costs to patients directly if urgent action is not taken.
The report shows that SHA has created a benefit package that provides extensive coverage, but the authority does not possess sufficient financial resources and operational capabilities to fulfill its contract obligations, which include timely hospital payment processing and effective digital claims system operation.
Healthcare providers have previously raised concerns about SHA’s reimbursement model because the payment formulas created confusion and the pending claims process required facilities to handle financial difficulties, which ultimately harmed their ability to deliver quality services to Kenyans. Observers also point to unpaid NHIF legacy debts, with some estimates placing outstanding obligations in the tens of billions, which further compounds the funding crisis.
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