September 2021 Businessdaily :Renal dialysis, major surgeries and diagnostics tests such as MRI and CT-scans top the list of benefits that the National Hospital Insurance Fund (NHIF) aims to cut in a drive to reduce payouts.
The State-backed insurer’s cost-cutting drive will reduce payouts to hospitals by at least Sh2.9 billion in the year to June 2022, forcing thousands of beneficiaries to top-up for their medical bills.
The maximum cover for MRI scan will be reduced to Sh9,600 from the current Sh15,000 per session while settlement of CT-scans is set to be capped at Sh6,000 from Sh8,000.
The average payout for renal dialysis will fall to Sh6,000 from the current Sh9,500 if the proposals are approved, hurting Kidney patients as the NHIF seeks to reduce bills for the weekly procedure by Sh1 billion annually to Sh2.7 billion.
But benefits for cancer patients are to be increased as the country battles rising cases of the deadly disease.
Average payment for PET scan— used to diagnose ailments like cancer — will increase to Sh40,000 from Sh32,320 while that for basic chemotherapy will be increased to Sh25,000 from the current Sh17,062.
Payouts for complex chemotherapy will be capped at Sh100,000 from Sh72,852, with average radiotherapy claim set at Sh72,000 from the current Sh61,224.
The review of benefits comes as the NHIF faces mounting claims from hospitals. The payouts more than doubled in five years from Sh19.7 billion in the year to June 2016.
It paid out Sh54.6 billion or 88.7 percent as claims to hospitals in the year ended June 2021.
NHIF chief executive Peter Kamunyo said a significant number of the patients with chronic illness are joining the fund after falling ill.
“We have patients paying Sh6,000 annually and receiving benefits of nearly Sh1 million per year. This is a burden to NHIF,” Dr Kamunyo said.
The scenario — called adverse selection in insurance terms— is putting at risk the ability of the insurer to settle claims and meet administrative costs.
Adverse selection refers to situations where an insurance company extends coverage to an applicant whose actual risk is substantially higher than the risk known by the insurance company.
Dr Kamunyo said a significant number of active voluntary contributors were suffering from chronic diseases, leaving the fund with huge monthly claims.
Voluntary contributors — usually drawn from the informal sector — pay Sh500 a month to the NHIF while those in the formal sector contribute between Sh150 and Sh1,700 every month, depending on salary scale.
The number of voluntary contributors has jumped in recent years on the back of a mass recruitment drive.
The NHIF seeks to cut the average payout for minor surgery to Sh22,000 from Sh26,215 while claims for major surgeries will be cut to Sh70,000 from the current Sh80,266.
It plans to lower the average claim for inpatient services from Sh12,412 to Sh10,890.
The move to review the medical payouts comes weeks after Parliament dealt the insurer’s efforts to increase its funding base a blow by rejecting a clause in the NHIF (Amendment) Bill, 2021 that sought to make membership to the scheme compulsory for all Kenyans above 18 years.
The National Assembly Committee on Health instead said that the national and county governments should foot the NHIF bills for the 5.1 million poor households across the 47 counties.
The committee also rejected a proposal to compel business owners to match workers’ monthly contributions, saying that it would put pressure on employers’ wage bill and hurt their ability to create jobs.
The fund has disclosed that 5.7 million members or 54 percent of the 10.6 million members had stopped paying premiums by the end of last month having benefited from its services, including key procedures that come with hefty bills.