The Ministry of Health has revealed that Ksh.20 billion has been lost through the National Health Insurance Fund (NHIF) scheme through manufactured claims and fake surgeries, among others fraudulently activities conducted by health facilities.

Health Cabinet Secretary Wafula Nakhumicha, in a statement on Friday, blew the lid on the scandal affecting health facilities, saying that out of 67 audited hospitals in the country, 27 had been suspended over the loss of Ksh.171 million through the NHIF program.

CS Nakhumicha said that about 40 per cent of total hospitals in the country (3,440) were involved in irregular processes resulting in the Ksh.20 billion losses.

“Between January and December 2023, out of 67 audited hospitals, 27 were found to be involved in fraudulent activities, resulting in a loss of Ksh.171 million,” she stated.

“Extrapolating this to the total population of 8,886 hospitals, it is estimated that approximately 3,440 might have been engaged in fraudulent activities, potentially exceeding Ksh.20 billion in losses from about 40% fraudulent hospitals. Luckily 60% carry out clean business.”

In the operation carried out by the newly unveiled Social Health Authority (SHA), the CS cited fraudulent activities including instances of induced demand targeting vulnerable citizens such as the elderly, induced sickness where facilities would deceitfully activate dormant member accounts, as well as financing medically unwarranted treatments. 

She said the elderly were mostly targeted in such areas as; Nairobi, Meru, Nyahururu, Muranga, Kerugoya, Makueni, TharakaNithi, Subukia, Nanyuki, Bungoma, Chuka, and Machakos.

The CS added that some facilities would have fictitious records that falsely indicate members undergoing major surgeries while actively at work, while even others would use security guards from licensed security firms and financially induce them to provide biometrics for fraudulent purposes.

According to Nakhumicha, the ministry also discovered anomalies whereby facilities with a theatre capacity of conducting only two eye surgeries in a day were conducting about 10 to 22 surgeries, something she noted questions the legitimacy of claims and the resources available at these facilities.