The risk of fraud was higher in the enhanced schemes, such as Edu Afya. Services in this scheme were mostly offered by Level 2 facilities, most of them lacking the infrastructure for biometrics.
From the financial statements of the years 2019 to 2022, the committee [Health Committee of National Assembly] noted that while premium contributions have increased three-fold, benefit payouts have increased five-fold.
It was also observed that the fund had liquidated some of its short-term investments without reinvestment. Short-term investments reduced from Sh13.3 billion in June 30, 2022, to Sh8.2 billion as of June 20, 2023, implying NHIF’s financial sustainability would have been compromised.
The committee observed the possibility of fraud and corruption occasioned by the collusion of NHIF staff, healthcare providers and beneficiaries.
Cases where beneficiaries were paid between Sh7,000 and Sh10,000 for biometric registration [at two hospitals] were noted.
A healthcare provider also claimed the cost of original molecules yet they dispensed generic molecules.
The committee observed that NHIF did not have sufficient competent quality assurance officers, yet the division was key in the surveillance, monitoring and evaluation of facilities and payment of claims.
The claims managers, the branch managers, and the quality assurance officers at NHIF branch offices were the first-line abettors of crime including colluding with health facilities to defraud the fund through fictitious, exaggerated and fraudulent claims.
The auditor general should undertake a special audit of NHIF on their utilisation of funds disbursed towards payment of claims for contracted health facilities in the financial years ending 2020 to 2023.
The DCI and EACC should conduct investigations on NHIF staff, healthcare providers, and auditors [mentioned in the report].
The insurer should also consider the findings [of the MPs' inquiry] on internal audit, pre-authorisation and claims management division, as well as report to the DCI and EACC on the involvement of staff in fraudulent activities.
The national health insurer should at all times ensure that all payments made are duly supported by requisite documents and adhere to the public procurement law and attendant regulations.
Excerpts of Health Committee report on NHIF
