- The new penalty rates which are expected to take effect next month will see defaulters pay 10 per cent of the contributor’s amount.
- Previous, the penalties were charged at half of the contributor’s amount translating to Sh250 for every month defaulted.
Image: NHIF
Self-employed contributors to the National Health Insurance Fund will now pay lower penalties should they default on their contributions.
The new penalty rates which are expected to take effect next month will see defaulters pay 10 per cent of the contributor’s amount.
Previously, the penalties were charged at half of the contributor’s amount translating to Sh250 for every month defaulted.
The new rates will now see those contributing Sh500 pay Sh50 as penalties should they default, a decrease of Sh200 from the previous amount.
NHIF acting CEO Samson Kuhora through a public notice on Thursday said the new rates will take effect from May 1.
“As per Section 19(2) of the NHIF Act, self-employed contributors who fail to pay their monthly contributions by the day when the monthly contributions are due shall be liable to pay equal to 10 per cent of the amount of the contribution,” Kuhora said.
This is after the NHIF Act of 1998 was amended on January 2022 highlighting the revised penalty rates on late contributions by members.
The due date for members’ monthly contributions remains the 9th day of the month after which the penalties will be charged both for self-employed contributors and for remittances from employers.
“Employers who fail to remit the employees’ monthly standard contributions by the due date shall be liable to pay a penalty equal to the lending rate of interest of the amount of contributions, as may be published by the Central Bank of Kenya from time to time,” Kuhora said.
A new report by the NHIF released in January showed that 8.8 million Kenyans defaulted on their monthly contributions by June 2022.
This reflects 43 per cent of the total NHIF members, signaling 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.