KENYA:Cotu approves rise in NHIF premiums to Sh1,700 monthly

September 2014 BusinessDaily; Workers monthly contribution to the National Hospital Insurance Fund (NHIF) is set to rise to Sh1,700 after the Central Organisation of Trade Unions (Cotu) Thursday reached a deal with the State-backed health insurer.

The proposed contribution will range between Sh150 and Sh1, 700 per month depending on the workers income.


Presently, salaried workers’ contributions to NHIF range from Sh30 to Sh320 based on the gross monthly salary and at Sh160 for pensioners and the self-employed.


The deal is a major coup for the NHIF management given that Cotu moved to court three years ago to oppose a review of the monthly premiums for the first time since 1989.


The fund in 2011 sought to increase the premiums to between Sh150 and Sh2, 000, meaning that Cotu has managed to squeeze a small concession.


The increase is expected to be particularly painful to a huge fraction of the working class, who will take home less pay at the end of the month at a time the National Social Security Fund (NSSF) is seeking to raise monthly contribution from Sh200 to Sh1, 080.


Cotu secretary general Francis Atwoli said the deal will be approved by the board of the workers’ representative in two weeks, setting the stage for withdrawal of the court suit.


“We went to court to annul the previous rates but once the figures are approved the case will be withdrawn on the disputed gazetted figures,” Mr Atwoli said in Mombasa yesterday after a meeting with the NHIF management.


But Cotu will also need to hold talks with the Federation of Kenya Employers, which had been enjoined in the suit.


The fresh proposal will effectively shift the burden of higher contributions to those earning more than Sh8,000.


Those earning less than Sh8, 000 will pay between Sh150 and Sh300 while those earning a gross monthly salary of Sh15,000 will pay Sh600, up from the current maximum of Sh320.


Those on a salary of between Sh60,000 and Sh90,000 will pay a range of Sh1, 300 and Sh1, 600 while workers earning above Sh100,000 will pay a flat fee of Sh1,700 per month.


NHIF chief executive Simon Ole Kirgotty said higher contributions will help the fund expand access to quality and comprehensive healthcare, which has been a preserve of rich and middle class households.


Services will include both an inpatient and outpatient covers and treatment for chronic illnesses such as diabetes, high blood pressure and HIV/Aids that some private health insurers do not cover.

The outpatient cover will be a first for NHIF, placing it at par with company-sponsored health insurance schemes.

NHIF has been accused of mismanaging the Sh9 billion it collects from workers annually.

Major scandals that have eroded public confidence in NHIF include a white-elephant referral hospital plot conceived 11 years ago and for which it has paid more than Sh1.5 billion in form of consultancy fees.


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