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Kenya’s healthcare system has for a long time grappled with numerous challenges, ranging from underfunding and weak financial management systems to overreliance on user fees and insufficient evidence to support decisions on efficiency and additional resources to health among other challenges. These issues have hindered the realisation of the country’s healthcare goals, as outlined in Vision 2030, which envisions a healthy and prosperous nation.

To address these challenges, the government has unveiled a series of bills, including the Social Health Insurance Bill, 2023, as part of the Bottom-up Economic Transformation Agenda (BETA). The central aim is to accelerate universal health coverage (UHC), ensuring that all Kenyans can access essential quality healthcare without facing financial hardship.

UHC is a pivotal component of Kenya’s development agenda. It strives to provide a comprehensive range of healthcare services, including prevention, curative, palliative, and rehabilitative care, to all citizens. To support this initiative, the government has proposed a multipronged approach, including the creation of a publicly financed primary healthcare system, ring-fencing healthcare funds, introducing a social health insurance fund (SHIF), leveraging technology, and establishing an emergency, critical, and chronic illness fund. These proposals are encompassed in four bills, with the Social Health Insurance (SHI) Bill, 2023, at the forefront.

In the endeavour to foster evidence-informed decision-making, it is imperative to subject these bills to rigorous scrutiny. We have to ensure they are comprehensive, inclusive, financially sustainable, and capable of addressing the complex healthcare challenges that plague the country. The African Institute for Development Policy (AFIDEP) analysis of the SHI Bill, 2023, focuses on two critical aspects: “More Money for Health” and “More Health for the Money.”

One of the most noteworthy features of the SHI Bill is the proposal to levy a 2.75% deduction on monthly gross pay to fund the SHI. This measure has the potential to significantly bolster healthcare resources. If implemented, this levy would generate substantial revenue from both the private and public sectors. If applied, the levy of 2.75% would mean that a total of Kshs.44.4 billion will be raised from private sector and Kshs.20.5 billion from the public sector, based on the 2022 statistical survey figures on employment and gross wages. Explicitly therefore, the revenues of the SHIF would increase by Kshs.65 billion, which is more than the current Kshs.60 billion from all sources. If other contributions are held constant, the proposed levy is likely to double the amount of money available for SHIF.

According to the Kenya National Bureau of Statistics, the informal sector constitutes 82.3% of employment in Kenya. This is a significant portion of the workforce. Indeed, making consistent and predictable contributions to the fund is a great challenge to people under this category. A situation exacerbated by the prevailing high cost of living. However, their inclusion is vital for the success of the SHIF. The Social Health Authority needs to find approaches in which these group of people will also contribute to the fund in a consistent and predictable way.

The bill states that every Kenyan must register as a member of the SHIF, assuming they will be entitled to healthcare services. Yet, the bill does not adequately address the issue of “ability to pay.” Section 27(4) of the bill stipulates that healthcare services can only be accessed if contributions to the SHIF are up-to-date and active. A question that the bill fails to address is what happens when individuals or households cannot afford these contributions? How then will the country realise its goal if there are some citizens who can’t pay for their medical cover under the national scheme?

The bill allows beneficiaries to take private health insurance cover, and clearly encourages employers to take up additional medical covers to their employees. Employers may hesitate to provide additional insurance cover due to the associated costs. This situation raises questions about whether the proposed reforms will genuinely improve the quality of service.

Section 28(a) of the bill addresses the management of chronic illnesses after the depletion of the social health insurance cover. This also raises concerns about potential duplication or conflict between the emergency, chronic, and critical illness fund and the social health insurance. Clear guidelines are needed to prevent such issues. Chronic diseases such as heart disease, cancer or diabetes are known to require long-term care, it is obvious that they would exhaust the social insurance once diagnosed. Would such disease then not be moved to the chronic fund instead of waiting to see them exhaust SHI?

The bill also falls short in addressing social accountability comprehensively. The composition of the Board of the Authority, outlined in Section 7(1), lacks representation from key stakeholders such as civil society organisations (CSOs) and the private sector. These entities play a significant role in ensuring accountability hence the need for their inclusion in the management of the fund cannot be overstated.

To align the Social Health Insurance Bill, 2023 with the principles of the Kenya Health Policy 2014–2030 and address these critical concerns, AFIDEP proposes the following recommendations:

• Equity and ability to pay: Develop clear strategies to consistently and predictably pool resources from the informal sector, ensuring equitable access to healthcare.
• Efficiency: Ensure that the bill promotes efficiency in healthcare delivery, focusing on cost-effectiveness and the optimal use of resources.
• Affordability: Base proposed levies on evidence and consider the broader economic impact of healthcare sector decisions.
• Quality of care: Strive for improvements in healthcare quality, reducing the need for additional private insurance cover.
• Social accountability: Include representation from CSOs and the private sector on the Social Health Authority board to enhance social accountability and stakeholder involvement.

Kenya’s pursuit of UHC is a commendable endeavour that requires careful consideration and well-rounded solutions. AFIDEP through the Advance domestic Health Finance project supports the government of Kenya in realising quality and affordable healthcare to all Kenyans. The Social Health Insurance Bill, 2023, represents a significant step in this direction. However, it is crucial to address the highlighted issues to ensure that the bill achieves its objectives effectively, providing accessible and high-quality healthcare for all Kenyans while maintaining financial sustainability. Only by doing so can we move closer to a healthier and more prosperous nation.