Monthly contributions to the National Hospital Insurance Fund (NHIF) will be reviewed every five years if Parliament adopts proposed changes to the law, indicating deeper financial strain on employers and workers.
The proposed changes to the NHIF Act will lead to automatic reviews of contributions to the State-run medical insurance fund—an issue likely to encounter resistance by employers and workers already strained by inflationary pressures.
The NHIF last reviewed its rates in April 2015 and is seeking to increase its income to boost cover for diseases like cancer and offer health insurance to all Kenyans.
The push for an automatic review is part of changes to the law that seeks to compel all adult Kenyans to contribute to the NHIF and employers to match workers’ monthly contributions to the fund.
The NHIF increased monthly contributions for formal workers from Sh350 to a graduated scale of up to Sh1,700 based on pay.
Contributions for informal workers were increased from Sh350 to Sh500.
The changes will make the State-backed scheme one of the richest insurers, with annual collections of close to Sh100 billion given its receipts of Sh60 billion in the year to June 2020.
“Grant the National Hospital Insurance Fund powers to review the rate after every five years with the approval of the National Assembly and require the fund to provide reasons for any proposed review,” says proposed changes to the NHIF (Amendment) Bill, 2021.
The State has proposed to make it compulsory for employers to match the Sh1,700 monthly remittances that top contributors make to the NHIF.
Employers have, however, opposed the proposal, warning that it will not only affect the wage bill and sustainability of enterprises but also weaken the capacity of businesses to create new jobs and sustain the existing jobs.
The push to have employers match their workers’ monthly contributions will see the NHIF raise an additional Sh25 billion.Parliament yesterday backed the changes, saying that they will boost the State’s bid to roll out the universal health coverage (UHC) scheme.The State is also seeking to make NHIF membership compulsory for every adult Kenyan, contributing Sh500 every month or Sh6,000 annually.Official data shows that NHIF had 8.898 million members at end of June last year, with 4.452 million drawn from the formal sector and 4.546 million from the informal segment.The planned mandatory NHIF membership will be an upgrade of the scheme where only workers in the formal sector are compelled to join.The proposals come at a […]
