Health Cabinet Secretary Aden Duale has dismissed a report in one of the local dailies, which alleged that KSh50 billion was lost at the Social Health Authority (SHA).
In a detailed response on Tuesday, March 10, CS Duale said that the figures cited in the report were a serious misrepresentation of facts to the Kenyan public.
The report by Nation Media Group had highlighted how in some health facilities, doctors allegedly conducted open heart surgery on the same patient four times in one day, with the cost covered for by SHA.
However, Duale says no billions have been lost or misappropriated, maintaining that the figures quoted in the report represent standard accounting provisions and legally sound payments.
“The Ministry of Health and the Social Health Authority (SHA) respect the role of the media in fostering public accountability. However, presenting statutory accounting estimates, legal benefit packages, and standard transitional bank transfers as “missing” or “looted” funds is a gross misrepresentation of facts,” Duale noted.
The report had cited an “irregular transfer” of KSh1.3 billion and “untraced” KSh1.3 billion from Social Health Insurance Fund (SHIF) to SHA.
Duale, in his response, asks, “How can a fund (SHIF) transfer money to itself or its own managing body (SHA) in a way that constitutes irregular loss?”
The CS also addressed claims of KSh2.8 billion “unsupported claims”, insisting that the money has not been paid out, nor is it missing.
“The Ksh 26.8 billion is simply the money SHA has responsibly set aside to pay hospitals for patients they treated, but for which the hospitals had not yet submitted the final paperwork by the close of the audit period. Under International Financial Reporting Standard 17 (IFRS 17), failing to reserve this money would be illegal. It is an accounting estimate of future liabilities, not a cash loss.”
The report also quoted another figure – KSh7.3 billion “unauthorised services”. According to Duale, the claim that the quoted money was paid for unauthorised services stems from a misunderstanding of different funds SHA manages.
SHA administers the standard SHIF for all Kenyans, but it also administers the Public Officers Medical Scheme Fund (POMSF) for teachers and civil servants. The POMSF is a distinct fund with a broader, enhanced benefit package (covering things like advanced surgeries and air evacuation) negotiated separately.”
He said that the auditor flagged the said amount of money because they were assessed using the standard SHIF rulebook instead of a separate POMSF regulations.
CS Duale also addressed the claim that KSh1.56 billion was sent to “uncontracted facilities”. Duale clarifies that during the transition to SHA in October 2024, the Ministry prioritised patients lives.
“We made a deliberate policy decision: any hospital that already had an active, valid contract with NHIF was automatically allowed to continue treating patients under SHA while their new digital e-contracts were being processed,” he noted.
According to Duale, flagging these facilities as “uncontracted” because they were in the middle of signing their new digital paperwork ignores the reality that turning patients away would have been catastrophic.
For small portion of claims, amounting to KSh92.4 million, where an actual contracting anomaly was found, Duale says SHA immediately suspended payments.
And on the last issue raised by the report involving alleged KSh2.4 million “overpayments”, Duale said the SHA digital claims system automatically corrects clerical input errors to match the official government tariff rates.
“The law dictates exact gazetted tariffs for specific treatments,” Duale explained. “If a hospital clerk manually keyed in an amount lower than the legally prescribed tariff by mistake, the SHA digital system automatically corrected it to match the legal gazetted rate.”
The CS urged the media to report responsibly by ensuring that all facts are presented objectively and that headlines accurately reflect the substance of the story, rather than driving unwarranted panic.
