Hospitals warn of collapse as Sh76 billion in health claims remain unpaid
The association described SHA’s financing model as unsustainable, noting that the authority collects about Sh5.4 billion monthly but generates claims of Sh8.7 billion, creating a monthly deficit of up to Sh3.5 billion.
The Rural and Urban Private Hospitals Association of Kenya (RUPHA) has raised the alarm over a growing healthcare crisis, citing billions of shillings in unpaid claims and unresolved National Hospital Insurance Fund (NHIF) debts that are straining hospitals countrywide.
According to RUPHA, as of August 2025, hospitals had submitted Sh96.2 billion in claims to the Social Health Authority (SHA), but only Sh53 billion has been paid.
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This leaves an outstanding balance of Sh43 billion, with lower-level facilities (Levels 2–4) reporting that half of all claims remain unpaid. General inpatient and surgical claims have stagnated, with payout ratios as low as 10–20 per cent.
Primary healthcare reimbursements are also delayed in several counties, while per-person payments are declining as patient visits rise against fixed global budgets.
"This is the lived reality of hospitals, not the narrative of 'timely payments' presented to the public," RUPHA said.
The association described SHA’s financing model as unsustainable, noting that the authority collects about Sh5.4 billion monthly but generates claims of Sh8.7 billion, creating a monthly deficit of up to Sh3.5 billion.
"Forcing Kenyans to pay annual lump-sum premiums is unrealistic given shrinking household budgets. The "Register Now" drive without a matching "Contribute Today" campaign has been a policy blunder. Hospitals are being flooded by patients while facilities lack medicines, staff, and operating cash flow," the association said.
RUPHA stated that unpaid NHIF debts, which now stand at Sh33 billion, were worsening the crisis.
Despite a Presidential directive on March 5, 2025, to settle debts of Sh10 million and below, the directive had not been implemented.
Combined with SHA liabilities, the association said hospitals were collectively owed Sh76.8 billion, with major public and mission hospitals, including Kenyatta National Hospital, Moi Teaching & Referral Hospital, Kenyatta University Teaching, Referral & Research Hospital, and Nakuru County Hospital, among the largest creditors.
The association further reported that hospitals faced mass rejection of valid claims without an avenue to submit clarifications, as well as arbitrary downgrades and suspensions of facilities, which it said violated contractual obligations and the Constitution of Kenya.
“By rejecting claims months after submission without giving hospitals a chance to clarify, SHA is clearly violating its own contract,” said RUPHA. “Clause 8.2 requires preauthorisation feedback within 72 hours and rejection notices within 14 days, while Clause 12.4 obligates SHA to return incomplete claims with reasons or notify rejections within 14 days. The continued delays are unacceptable and undermine service delivery.”
In response, RUPHA has demanded the immediate settlement of NHIF liabilities, payment of at least 50 per cent of outstanding SHA claims within 14 days.
RUPHA further demands activation of a claims clarification mechanism, establishment of a Dispute Resolution Tribunal, and transparent publication of claims data.
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