AFRO-NETS> Transforming health care financing system in Kenya

[Claudio Schuftan <aviva@netnam.vn>]

Transforming health care financing system in Kenya
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From: "Richard G. Wamai" <rgwamai@yahoo.com>
 
In an earlier contribution..... I gave a brief of Kenya's statutory 
health care financing scheme - the national Hospital Insurance Fund 
(NHIF). I feel it necessary to make another contribution in light of 
a recently launched bill that proposes the transformation of the NHIF 
into a national social health insurance scheme. This information is 
fresh and has been documented today. The following is a brief:
 
Called the National Social Health Insurance Strategy (NSHSI), the 
bill proposes that all fees for basic hospital care regardless of the 
disease of socio-economic status be fully covered by the government. 
These include doctor's fees, bed and drugs. In order to finance the 
scheme to cost Ksh40 billion annually, the Strategy requires that all 
Kenyans and permanent residents contribute between Ksh400 and Ksh600 
per year. Those in formal employment will contribute through their 
work place while those in the informal sector will put in Ksh400 
through their trade associations and women groups. This will bring in 
Ksh12 billion and Ksh10 billion annually while taxation on tobacco 
and alcohol will add Ksh11 billion. The taxation and other revenue 
will help the government cover those unable to pay the premiums. Be-
cause of its universal and comprehensive coverage and that every per-
son rather than household contributes, the compulsory scheme will 
differ sharply from the NHIF. 
 
Announcing the social health insurance scheme, the Minister of Health 
said it would be operational by July 2004 with the Ksh6 billion NHIF 
assets forming the initial capitalization. There is every reason to 
expect that the system will be implemented as the new Narc government 
has pledged its commitment to the reforms and health system renewal. 
The key challenge to its successful and effective implementation will 
be management in particular regard to the installation of a system of 
registering all salaried persons and deducting their premiums, and 
the identification of poor persons who are unable to pay for whom the 
government must then cover.
 
Postcript: 
 
This system will effectively place the government as the (sole) buyer 
of health insurance. How the Health Maintenance Organizations (HMOs) 
that currently offer medical insurance cover, e.g., British-American 
and many others, will transform will be an interesting scenario to 
watch. The new system has been likened to the one in place in South 
Korea and Colombia. 
 
Richard Wamai
University of Helsinki
(Currently at the Nordic-Africa Institute, Uppsala, Sweden) 
mailto:rgwamai@yahoo.com
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