A new report by the National Hospital Insurance Fund shows that 8.8 million Kenyans defaulted on their monthly contributions by June 2022.
This reflects 43 per cent of the total NHIF members, signalling a huge number of Kenyans who are no longer benefiting from the fund.
According to NHIF data, the number of members in default status jumped from 5.03 million in 2021 to 8.8 million by June 2022.
Consequently, the public health insurer failed to hit its Sh90.57 billion revenue target from premium collections for the year under review.
Although membership grew to 15.4 million from 13.94 million, those identified as active stood at only 6.7 million.
“The target was not achieved due to macro-economic factors in the country, which caused companies to downsize, reduce salaries and some to close,” NHIF said in a health sector report made public by the Treasury.
“The informal sector has also faced financial challenges caused by the poor economic conditions thus making it difficult for members of this sector to make their voluntary contributions to the fund.”
Members of the informal sector pay voluntary contributions of Sh500 a month to the NHIF while those in the formal sector contribute between Sh150 and Sh1,700 every month, depending on the salary scale.
Registered members who have defaulted on the monthly premiums are usually locked out of utilising their insurance covers for hospital bills.
Defaulted premiums condemn members to out-of-pocket expenses to settle the bills, with NHIF requiring them to settle the arrears first.
However, NHIF usually gives a window to defaulters to pay Sh1,500 to reactivate their membership but they have to wait for three months before becoming eligible to enjoy the cover.
NHIF had in the financial year ended June 2021 suffered the first decline in annual premiums in 18 years after Kenyans were hit hard by the economic effects of the Covid-19 pandemic.
The fund says premiums collected rose by 30 per cent from Sh60.78 billion in the 2020-2021 financial year to Sh78.84 billion in the period under review.
However, benefits paid out jumped by 45 per cent from Sh49.04 billion to Sh71.34 billion.
