Over 700 private hospitals face collapse as SHA, NHIF debts hit Sh76 billion

Over 700 private and faith-based hospitals across Kenya are on the verge of collapse as unpaid debts from the Social Health Authority (SHA) and the National Hospital Insurance Fund (NHIF) pile up, the Rural and Urban Private Hospitals Association (RUPHA) has warned.

According to the association, hospitals are owed Sh76 billion, a financial burden that is particularly acute in rural and underserved counties such as Wajir, Mandera, Marsabit and Samburu, where private hospitals are often the only providers available.

In a statement on Thursday, RUPHA Chairman Dr Brian Lishenga said the mounting arrears threaten the survival of facilities and the delivery of healthcare services across the country. He noted that the crisis stems from persistent delays in SHA reimbursements.

“Despite a ministerial directive that SHA reimbursements to facilities be made on the 14th of every month, this has not been honoured. Payment delays remain the norm, crippling hospitals’ ability to sustain services,” Lishenga said.

He revealed that since SHA’s inception in October 2024, hospitals have submitted Sh93 billion in claims, yet only Sh50 billion, about 53 per cent, has been reimbursed. Hospitals are now collectively owed Sh43 billion.

“This is a sign that SHA is not collecting enough money to reimburse hospitals,” Lishenga added.

He also criticised SHA for publishing facility-level reimbursement figures without showing total claims submitted, approved or payout-to-claims ratios.

“Publishing figures without disclosure of total claims submitted, approved, and payout-to-claims ratios is misleading. This is being done in the guise of transparency,” he said.

The chairman said payment delays have forced some hospitals to abandon the Social Health Insurance Fund system and revert to cash-only payments.

RUPHA further highlighted that primary healthcare (PHC) reimbursements remain unpaid in counties piloting the Digital Superhighway programme, including Mombasa, Kirinyaga, Embu, and Nandi.

“Hospitals in these counties are under-resourced, undermotivated and unable to deliver on the government’s promise of ‘free primary healthcare.’ This threatens the credibility of Universal Health Coverage,” he said.

Adding to the sector’s woes, the Association said more than 10,000 inpatient beds and 3,500 maternity beds have been deleted from the SHA portal despite hospitals holding valid Kenya Medical Practitioners and Dentists Council licences.

“We are gravely concerned that facilities have had their bed capacity deleted and downgraded in the SHA portal despite having valid KMPDC licences,” Lishenga said.

RUPHA also criticised Health Cabinet Secretary Aden Duale’s directive to close facilities over alleged fraudulent claims. RUPHA Vice Chairman Joseph Kariuki noted that legitimate claims are being placed under review for months without explanation, further straining hospital cash flow.

The crisis is compounded by NHIF arrears, which now stand at Sh33 billion, more than five months after President William Ruto directed that all pending bills be cleared.

Other Topics To Read

• Headlines
• Health
• Social Health Authority
• Social Health Insurance Fund (SHIF) scheme
• Rupha
• RUPHA Chairperson Brian Lishenga
• Over 700 private hospitals face collapse as SHA
• NHIF debts hit Sh76 billion

“More than five months after the president’s directive, no hospital has received the money. NHIF arrears now amount to Sh33 billion. Hospitals are facing insolvency whilst the government delays action,” Lishenga said.

The association has now called for immediate action, urging the government to ensure timely and complete SHA reimbursements, resolve PHC payment delays in pilot counties, respect due process in facility regulation, and clear the total Sh76 billion owed to hospitals.

“Publish not only payouts but also total claims submitted and payout ratios. Honour monthly payment commitments and cease unlawful downgrades and closures. Facility inspections must also follow constitutional safeguards and existing legal frameworks,” the Association said.

“Additionally, settle Sh76 billion owed to hospitals (Sh33 billion NHIF + Sh43 billion SHA) and implement a Marshall Plan for health financing before hospitals collapse.”

RUPHA warned that without urgent intervention, many hospitals, particularly in rural counties like Wajir, Mandera, Marsabit, and Samburu, may close, leaving thousands of patients without essential healthcare services.