May 2021 Businessdaily; Every adult Kenyan will soon make an annual compulsory Sh6,000 contribution to the National Hospital Insurance Fund (NHIF) if Parliament adopts State-backed changes to law in race to offer medical cover for all.
The government-backed National Hospital Insurance Fund (Amendment) Bill seeks to make it compulsory for every Kenyan above 18 years to contribute and be a member of NHIF.
They will be required to pay Sh500 monthly in a remodelled universal health coverage (UHC) scheme for outpatient and inpatient services, including maternity, dialysis, cancer treatment and surgery.
The planned mandatory NHIF membership will be an upgrade of the scheme where only workers in the formal sector are compelled to join.
“The Bill proposes to insert a new Section 15A to make it mandatory for any person who has attained the age of 18 years and is not a beneficiary to register as a member of the Fund,” states the memorandum of the Bill.
The review of law, which is currently before Parliament, will target more than 16 million adult Kenyans who are not covered by the NHIF.
Official data shows more than 25.36 million Kenyans are above 18 years and NHIF has 8.898 million members.
The compulsory enrolment has the potential of making NHIF the richest State-backed firm given that the proposed law will also compel employers to match workers’ monthly contributions to the Fund.
Doubling the Sh1,700 that top contributors make to the NHIF ranks high on the list of targeted changes to the NHIF Act.
The NHIF Act makes it voluntary for informal workers to join and contribute Sh500 monthly. Only those in formal jobs are compelled to contribute between Sh150 and Sh1,700, depending on the salary scale.
It is not clear how the State intends to make the unemployed or those working in the informal sector to compulsorily register and contribute to NHIF.
“The Minister (for health) may, in consultation with the board, make regulations for the better carrying out of subsection I (on compulsory contribution),” says the Bill.
Currently, parents who are members of NHIF are allowed to enroll their children as beneficiaries until they turn 18.
NHIF continues to cover such beneficiaries up to 21 years provided they have no income of their own and are living and fully dependent on the contributors.
Only those who are mentally or physically handicapped and fully dependent on contributors are excluded from getting their own cover after 21 years.
Earlier, the State had offered to sponsor one million poor households at the onset of the UHC scheme, which is modelled on the US’s Obamacare that requires all Americans to buy insurance cover.
Obamacare that is anchored in the Affordable Care Act (ACA) requires everyone to have a health cover and imposes a tax penalty on those who fail to purchase a health insurance plan.
It, however, offers subsidies to those who cannot afford a plan on their own through tax credits and paying insurance companies to keep their deductibles low.
Due to low insurance penetration, a quarter of all Kenyans’ healthcare bills are paid out-of-pocket, according to the World Bank.
This leaves many families vulnerable and reliant on debt and donations or disposal of assets such as livestock or household goods.
Kenya has prioritised the attainment of UHC by 2022 by expanding the NHIF after years of false starts.
When former President Mwai Kibaki took office, the Health ministry introduced a minimal user fee for primary healthcare facilities. The National Social Health Insurance Fund Bill introduced in 2004 proposed that the State pay Sh11 billion to the NHIF annually to meet the insurance costs for the poor.
Mr Kibaki, however, rejected the Bill, citing the implications of the huge cost on the economy.
After years of lobbying, the NHIF raised workers’ maximum contributions from Sh320 to a graduated scale of between Sh500 and Sh1,700 per month based on monthly pay, introducing outpatient cover for contributors and enhanced benefits for specialised treatment such as cancer and kidney dialysis.
President Uhuru Kenyatta is making another attempt to give all Kenyans health cover by 2022 after rolling out a pilot in four counties — Machakos, Nyeri, Isiolo and Kisumu.
The efforts to expand the national insurer’s mandate has often met resistance from the private sector players, who want to maintain status quo, fearing loss of revenue.