NHIF pays five times more for drugs

The Amal and Beirut hospitals in Eastleigh were found to have committed fraud as a result of investigations by the National Health Insurance Fund (NHIF) into how medical facilities preyed on the elderly to earn millions of shillings.
Afya Bora Hospital, Afya Bora Hospital Annex, Jekim Hospital Nkubu Ltd, Jekim Medical Center, Joy Nursing and Maternity Eastleigh, and St Peter’s Orthopaedics and Surgical Specialty are among the hospitals that have been stopped and are the subject of investigations, according to Samson Kuhora, the interim CEO of the NHIF.
“According to media reports, there was fraud in regards to the members who used the service. Amal Hospital and Beirut Hospital, both of which are located in Eastleigh, have been found guilty, and their completed and submitted reports to the board,” said Dr. Kuhora, who spoke on Tuesday to the parliamentary health committee.
“Investigations into the other cases, which began on June 16 of this year, are still proceeding and are anticipated to be finished in 90 days.”
Investigations into alleged fraudulent medical claims and capitation payments by the NHIF to healthcare facilities are being conducted by a committee led by Endebess MP Robert Pukose.
He stated that any healthcare facility implicated in the fraud will face a five-year suspension with the option of an appeal after two years.
“What we typically recover is the amount that has been lost by NHIF,” the statement reads. “We then file reports with other investigative agencies to take other legal actions, but what we currently recover is the amount listed as lost by the fund.”
The MPs also revealed that they had official documentation on how some NHIF employees had teamed up with Indian healthcare providers to steal millions through shady medical payments and claims.
“We realize that, regrettably, fraud and corruption have crept into the healthcare industry, creating serious obstacles to achieving our aim of ensuring fair access to healthcare. The probability of medical fraud was projected to be 29.3% in an impact assessment study that was presented to the board in 2020, according to NHIF’s report to the health committee.
However, Dr. Kuhora emphasized that the NHIF had issues receiving government premiums in the most recent fiscal year.
“We usually anticipate that the payments have been made within quarter one,” he said. “But in the last financial year we have had challenges with remittances from government entities and that is what has led to the accumulation of funds.” He added that they are working closely with the ministry to get disbursements on time. “We usually have the premiums paid within the first 90 days of the financial year, so within quarter one we usually anticipate that the payments have been made.”
The NHIF has implemented biometrics, according to information provided to the MPs about its efforts to combat fraud and corruption.
The interim CEO stated, “The addition of biometric verification has strengthened our authentication processes, ensuring the precise identification of beneficiaries and reducing identity-related fraud.”
The committee’s chairman, Dr. Pukose, pressed the NHIF to offer specifics regarding how it was protecting itself from fraud involving healthcare providers.
Hospitals “grossly abuse the process, charging exorbitant amounts, two to five times more for the generic version of medicine but indicating the price as it would cost for the original version of drug when they are claiming money from NHIF,” the chairperson of the Kenya Pharmaceutical Distributors Association, Kamamia wa Murichu, told the MPs.
Dr. Murichu asserts that when a hospital submits the claim to NHIF, the cost of a medicine that costs Ksh600 at the pharmacy will be four to five times higher.
“The original version of the drug will be indicated when the claim is being sent to NHIF,” he stated.
Additionally, the MPs discovered that Abdullahi Ali, the NHIF’s quality assurance lead and a geologist, wants him dismissed.
The committee chairman emphasized that between 2021 and 2023, the NHIF’s investment capital fell from Ksh15 billion to Ksh8 billion, a decrease of Ksh7 billion.
“This is the reason the health insurer had been selling short-term assets and depleting reserves,” according to Dr. Pukose.