The National Health Insurance Fund (NHIF) in Kenya is facing serious scrutiny following an audit report that reveals significant financial irregularities.
According to Nation, Auditor-General Nancy Gathungu’s findings for the fiscal year ending June 2023 expose a troubling pattern of overpayments, duplications, and questionable practices within the fund.
One of the most alarming discoveries is an unexplained discrepancy of Sh367,771,326 between what hospitals billed and what NHIF paid out across ten schemes. The NHIF’s explanation for this massive overpayment was surprisingly mundane. As Gathungu reports:
“Although management attributed the variance to typing errors made by hospital clerks while inputting bill amounts in the e-claim system, there was no evidence of reconciling the billed amount to claims paid or requests for refunds for overpayments.”
What the Audit Uncovered
The audit uncovered several other irregularities, including:
1. Overpayments in the Linda Mama scheme, which supports free childbirth services. NHIF paid out Sh54.5 million more than hospitals billed for this program.
2. Suspicious duplications in claims, particularly for caesarean sections and normal deliveries. As the audit notes:
“The amount includes Sh5,713,000 paid to NHIF accredited hospitals whose analysis revealed 656 duplicate case code (01) on caesarean section delivery procedures carried out on the same patient. Similarly, the amount includes a balance of Sh41,332,700 whose analysis revealed 10,860 duplicated case code (02) on normal deliveries on the same patient.”
3. Excess payments and duplications in the National Health Scheme (NHS), with NHIF paying Sh205.9 million more than billed without explanation.
4. Discrepancies in the Fund’s debt to healthcare providers, with Sh2.9 billion of the Sh12 billion owed showing duplicate entries with conflicting information.
The audit also highlighted systemic issues that may be contributing to these problems:
1. Hospitals submitting claims up to five years after the mandated 30-day period.
2. Insufficient quality assurance staff to monitor admissions and verify claims.
3. Long-term assignments of branch managers and quality assurance officers, potentially leading to compromised oversight.
As Gathungu points out:
“Review of human resource records revealed that 23 branch managers and 29 quality assurance officers who are key personnel in the management of claims have been in the same branch for between 5-13 years. This may result in familiarity or friendly approach to clients which is likely to compromise surveillance and enforcement duties.”
