KENYA: NHIF fails to renew cover for state workers

August 2020 DailyNation; Government employees and front-line health workers continue to remain exposed during the Covid-19 pandemic period following the expiry of their medical, life and last-expense insurance covers.

The contracts for the scheme that caters for civil servants and the National Police Service expired on March 31, but the National Hospital Insurance Fund (NHIF) is yet to renew them.

This is despite a directive by President Uhuru Kenyatta on April 16 requiring that all essential and front-line personnel be taken care of in respect of, among other areas, insurance cover.

President Kenyatta said such an incentive would motivate doctors, nurses and other cadres of health workers tackling Covid-19.

So far, more than 670 front-line workers have been infected with the coronavirus.

Nevertheless, the Public Procurement Regulatory Authority (PPRA) has directed NHIF to follow the procurement law to the letter in getting a new party to provide the covers.

MEDICAL COVER

In an advisory letter to NHIF boss Peter Gathege, PPRA Quality and Research Manager Peter Ndung’u, on behalf of the director-general, notes that even if the tender for the provision of medical cover is advertised now, it would still leave the beneficiaries exposed until the award letter is issued.

“You are reminded to ensure that the subject procurement is carried out in accordance with the Act and the Regulations issued under the repealed Public Procurement and Disposal Act, 2005,” Mr Ndung’u says in the letter dated May 8, 2020.

Mr Gathege was unreachable for a comment by the time of going to press. “While we note that the urgency and the risk exposure presented by the expiry of the contract cover in particular due to Covid-19 disease and the need for provision of insurance cover to essential and front-line personnel as directed by the Head of state, we note that your procuring entity sought our advice one month after the subject contract expired,” Mr Ndung’u says.

The effect of the delayed recruitment of an insurance provider is that government doctors, nurses and other front-line health workers and civil servants who succumb to Covid-19 or any other critical illnesses will most likely not be compensated.

The practice is that NHIF contracts the provision of Group Life Cover and Last Expense Cover to a third party through tendering.

CONTRACT PERIODS

According to PPRA, while Section 139 (2) of the Act guides on the extension on contract periods, the procurement law does not have a provision for extending expired contracts.

Section 44 (1) of the Act states that an accounting officer of a public entity shall be primarily responsible for ensuring that the public entity complies with the Act.

Initially, National Treasury Cabinet Secretary Ukur Yattani had barred NHIF from engaging in commercial insurance because it is not registered with the Insurance Regulatory Authority (IRA) as an insurance provider.

Section 19 of the Insurance Act provides that a firm providing insurance services in the country must be registered with IRA.

Mr Yattani’s decision saw then NHIF acting Chief Executive Officer  Nicodemus Odongo, in a letter dated February 26, 2020, announce that the cover for the government employees  would lapse on March 31, 2020m, meaning new providers would have to be found.

The implication of this letter was that the affected clientele will now be forced to tender for other providers.

The move followed months of haggling and correspondences between the National Treasury and the Ministry of Health over whether NHIF, a state corporation, should be allowed to engage in commercial insurance despite not being registered as an insurance provider under the Insurance Regulatory Authority (IRA).

The end of the medical insurance cover provided by NHIF through third parties also affected at least 52 institutions that were already on board.

They include state corporations, county governments and private entities including associations and church groups across the country.

However, on June 3, 2020, Mr Yattani exempted NHIF from the provisions of section 19, 179 (6), 197A and 197B of the Insurance Act for the purpose of offering enhanced medical, group life and last expense cover for the government employees.

But the NHIF is yet to get a new service provider on board.

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