The Social Health Authority (SHA) has revealed the latest status of claims processing under the TaifaCare rollout, exposing shocking levels of fraud and non-compliance among health facilities.
Since the program was launched on October 1, 2024, SHA reports that while billions have been disbursed to hospitals, a significant portion of claims have either been rejected, flagged for fraud or placed under investigation.
In a statement on Monday August 25, Health Cabinet Secretary Aden Duale stated that under the Primary Healthcare (PHC) program, health facilities have submitted claims totaling KSh 9 billion, out of which KSh 7.7 billion has already been paid. The balance is expected to be cleared in the next payment cycle.
The situation under the Social Health Insurance Fund (SHIF), however, paints a more troubling picture.
Facilities submitted claims worth KSh 82.7 billion, but only KSh 53 billion has been settled. An additional KSh 6.4 billion in claims has been approved and is awaiting payment, while claims worth KSh 10.6 billion were outrightly rejected due to fraud or non-compliance.
Furthermore, KSh 3 billion in claims are under re-evaluation due to missing documents, KSh 2.1 billion are under surveillance for possible fraud and KSh 7.6 billion in claims for the month of August remain under review.
CS Duale further noted that Healthcare fraud is a global issue, estimated to drain between 3% and 15% of total health expenditures annually. In Kenya, the Association of Kenya Insurers (AKI) estimates that fraudulent claims account for nearly 30% of all payouts.
Duale also stated that since his assumption of office on April 1, 20 a digital fraud detection system has been rolled out to address vulnerabilities that crippled the defunct NHIF. The system integrates Artificial Intelligence to flag anomalies across the claims process, making fraud detection more efficient as data accumulates.
The crackdown has already seen severe consequences for non-compliant facilities. By June 30th, SHA had closed 728 health facilities and downgraded 301 others following audits. On August 8th, a press briefing announced the suspension of 40 additional facilities, with 45 more awaiting degazettement for fraudulent practices.
The Audits uncovered two main schemes:
- Upcoding – billing for more expensive procedures than those performed.
- Falsification of Records – altering or submitting false medical documents, contravening Section 48(5) of the Social Health Insurance Act, 2023 and Regulation 34(2)(f) of the Social Health Insurance Regulations, 2024.
SHA has vowed to intensify enforcement, stressing that healthcare fraud is not just a financial burden but a systemic menace undermining the credibility of Kenya’s new universal healthcare system.
“Fraud can be detected and stopped at any point, including during payment. With AI surveillance, every fraudulent activity leaves a digital footprint,” the Authority said.
As investigations continue, SHA has assured Kenyans that genuine claims will be settled promptly, while fraudulent ones will face legal consequences.
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