NAIROBI, Kenya — The future of the Social Health Authority (SHA) is under scrutiny after Members of Parliament warned that the national health scheme may be financially unsustainable, with revenue barely covering operational costs.
The concerns were raised by James Nyikal, chair of the National Assembly Departmental Committee on Health, following an oversight visit in Mombasa on March 19.
According to Nyikal, the authority currently collects approximately Sh7.4 billion monthly, largely from salaried Kenyans, against expenditures of about Sh7.2 billion.
“The revenue that the Social Health Authority collects for the three funds in that Authority is really not enough to meet its expenses as things are now. They are barely getting what they can run on. So the revenue versus the expenses is a challenge,” he said.
“We are likely to face an issue of sustainability,” he added.
SHA, which replaced the National Health Insurance Fund (NHIF) on October 1, 2024, was designed to expand universal health coverage. However, lawmakers say it is struggling to meet obligations to hospitals and beneficiaries amid operational and financial constraints.
Nyikal attributed the challenges largely to weak contributions from the informal sector, leaving formally employed Kenyans—who contribute 2.75pc of their salaries—to shoulder the bulk of the funding burden.
Data presented to the committee shows that while about 29 million Kenyans are registered under SHA, only 4.8 million are actively contributing. Of these, between 3.5 and 4 million are salaried workers, while roughly 890,000 come from the informal sector.
Despite collecting an estimated Sh142.78 billion and disbursing about Sh105 billion to healthcare providers, the scheme has faced criticism from hospitals over delayed or unpaid claims. Some facilities have reportedly scaled down services due to cash flow challenges linked to the fund.
The concerns come just days after the Office of the Auditor-General flagged potential losses of up to Sh50 billion during the scheme’s initial rollout in 2024, further intensifying scrutiny over its management.
“My view about the whole thing, the design and the concept, is good. The problem we are going through is a problem of implementation,” Nyikal said.
In response to the funding gap, SHA is exploring new strategies to boost contributions, particularly from the informal sector. These include partnerships with savings groups, SACCOs, and microfinance institutions to enable gradual premium payments.
The government is also considering increasing monthly contributions for self-employed members from an average of Sh560 to Sh880 to improve sustainability.
President William Ruto has consistently defended the scheme, arguing it is central to achieving universal healthcare and will ultimately benefit all Kenyans.
