A parliamentary committee has uncovered a major corruption scandal involving former National Hospital Insurance Fund (NHIF) officials who allegedly colluded with hospitals to siphon Sh828 million through fraudulent claims. The National Assembly’s Public Investments Committee on Social Services, Administration, and Agriculture has recommended that those implicated face prosecution for orchestrating payments for non-existent medical procedures and duplicate claims.
According to the committee’s report, NHIF officials worked with medical facilities to exploit loopholes in the system, allowing them to make fictitious claims under the National Health Scheme Benefit. The report highlights that out of a total expenditure of Sh29.9 billion, a staggering Sh828,729,148 was disbursed through irregular and fraudulent transactions. This included overpayments amounting to Sh94.8 million for CT scans, Sh16.1 million for MRI procedures, Sh285.8 million for major surgeries, and Sh29 million for minor treatments. Other questionable transactions included Sh25.5 million for basic chemotherapy, Sh3.6 million for specialized surgeries, Sh3.3 million for rehabilitation, and over Sh2.5 million for childbirth procedures, including normal deliveries and Caesarean sections.
One of the most shocking revelations was that NHIF paid hospitals Sh5.7 million for 656 duplicate Caesarean-section procedures that were allegedly performed on the same patients. The report also found that hospitals exploited weaknesses in NHIF’s claims system, submitting duplicate claims amounting to Sh247 million under the National Health Scheme alone. A particularly glaring case was a hospital in Kikuyu Town that reported performing more Caesarean sections than the country’s largest referral facility, Kenyatta National Hospital, raising serious concerns about fraudulent billing practices.
The committee, chaired by Navakholo MP Emmanuel Wangwe, has called on the Ethics and Anti-Corruption Commission (EACC) to conduct urgent investigations and submit findings to the Director of Public Prosecutions (DPP) within three months. The lawmakers stressed the need for swift action to bring those responsible to justice and recover the misappropriated funds. They also recommended that NHIF accounting officers, board members, and other senior officials be held accountable for the financial irregularities.
The scandal has exposed systemic weaknesses within NHIF that facilitated fraudulent claims. According to the committee’s findings, hospitals used single case codes to claim multiple benefits, while others manipulated invoices by consolidating multiple treatment sessions into one bill. The committee further flagged NHIF’s lack of robust monitoring mechanisms, which made it easy for fraudsters to exploit the system without detection.
The committee’s report has intensified calls for accountability, with MPs emphasizing the need to prevent similar fraud under the newly established Social Health Authority (SHA). Kwanza MP Ferdinand Wanyonyi urged continuous oversight to ensure that the committee’s recommendations are implemented, warning that failure to act could result in continued financial mismanagement. Nandi Hills MP Bernard Kitur echoed these sentiments, calling for the immediate prosecution of those implicated in the fraudulent transactions.
Meanwhile, the government has taken steps to address concerns over pending hospital claims. President William Ruto recently announced that the government would settle claims of up to Sh10 million owed to public, private, and faith-based hospitals. However, claims exceeding this amount will undergo further verification before disbursement. To mitigate the risk of future fraud, the government has pledged to process payments on a monthly basis under SHA, which has already cleared Sh18.2 billion in undisputed claims since its inception in October 2024.
The NHIF scandal has cast a shadow over Kenya’s healthcare financing system, fueling public distrust in government-managed health schemes. While the SHA was introduced as a replacement for NHIF with the goal of enhancing transparency and efficiency, critics argue that similar vulnerabilities may persist unless strict oversight measures are enforced. The parliamentary committee has urged reforms within SHA to strengthen accountability mechanisms and close loopholes that could be exploited for fraudulent claims.
The unfolding developments have placed the spotlight on the EACC and the ODPP, with Kenyans keenly awaiting action against those responsible for the mismanagement of funds. The case is expected to set a precedent for future anti-corruption efforts in Kenya’s healthcare sector, as authorities work to restore public confidence and prevent further financial losses.
