The Social Health Authority (SHA) will begin enforcing health insurance premium payments for self-employed Kenyans using data from various government institutions starting February 28, 2025. The initiative will rely on information from the Kenya Revenue Authority (KRA), the Hustler Fund, the Ministry of Lands, and the Registrar of Companies to ensure contributions accurately reflect individuals’ financial status.
This move is aimed at addressing widespread cases of misrepresentation, where individuals understate their income and assets to qualify for lower premiums. Currently, self-employed Kenyans self-declare their financial standing using the Means Testing Tool (MTT), but many have reportedly manipulated this system by claiming to be landless or living in poor conditions to pay lower contributions.
To curb these fraudulent declarations, the Ministry of Health is developing a sophisticated algorithm that will cross-check financial records across multiple government agencies. The upgraded system will utilize data triangulation, integrating information from:
- Kenya Revenue Authority (KRA) – to assess declared income and tax compliance.
- Hustler Fund – to review loan access and repayment records.
- Ministry of Lands – to verify property ownership.
- Registrar of Companies – to check business ownership and revenue streams.
- Kenya National Bureau of Statistics (KNBS) – for economic data validation.
- Immigration Department – to track frequent travelers who might be wealthier than declared.
- Communications Authority – to analyze mobile money and banking transactions.
- Kenya Power – to assess electricity usage, which can indicate financial status.
- National Transport and Safety Authority (NTSA) – to verify vehicle ownership.
- Insurance Regulatory Authority (IRA) – to check private insurance policies.
- Ministry of Cooperatives – to track SACCO membership and savings.
According to Health Cabinet Secretary Deborah Barasa, the new enforcement system will lead to more accurate premium assessments, ensuring fair contributions from informal sector workers. “Currently, the average monthly payment under SHA is Sh560, but we need Sh880 for the system to be sustainable. Some individuals have been cheating the system, and this initiative will correct that,” Barasa said.
The government intends to increase compliance among informal sector workers by enrolling them through organized groups such as:
- Boda boda riders
- Jua Kali artisans (4.3 million workers)
- Public transport drivers and conductors (1 million workers)
- Small business owners and traders in open-air markets
To ease the financial burden on households with irregular incomes, SHA plans to introduce Insurance Premium Financing (IPF), a scheme that will allow families to pay premiums in installments.
Deputy President Kithure Kindiki has directed SHA to roll out the new algorithm by February 28, emphasizing the need to improve the predictability of premium payments. Despite SHA registering 19.5 million members, only 3.5 million, primarily in formal employment, are actively contributing. Meanwhile, the government is subsidizing the premiums of 1.5 million indigent Kenyans, while 14.5 million members are only accessing free primary healthcare.
“For Kenyans to receive care in Level 4 facilities and above, they must contribute. From March 1, we will launch a national campaign to drive enrolment and ensure predictable premium payments,” Kindiki said
The move to raise average premiums for self-employed Kenyans could face resistance, especially given the high rate of non compliance in previous schemes such as the National Health Insurance Fund (NHIF). In the 2021/2022 financial year, NHIF membership increased from 13.94 million to 15.4 million, but only 6.7 million members primarily formal sector employees paid consistently.
Additionally, the affordability of the new SHA premiums remains a concern. With Kenya’s poverty rate at 39.8%, over 20 million citizens struggle to afford basic necessities, making the new contribution model potentially unsustainable.
While the Kenya Kwanza administration had initially lowered the SHA premium to Sh300 in an effort to boost enrollment among informal sector workers, the proposed increase may deter participation. The government will need to ensure that the revised enforcement mechanisms do not disproportionately burden low-income earners.
The enforcement of SHA premiums using KRA, Lands, and Hustler Fund data marks a significant shift in Kenya’s approach to health insurance compliance. By leveraging cross-agency data, the government aims to ensure fair contributions while strengthening the sustainability of the SHA system. However, the success of this initiative will depend on how well it balances enforcement with affordability for millions of self-employed Kenyans.
