Insurers won’t pay all Covid hospital bills in about-turn

Kenyan insurers have made an about-turn on paying Covid-19 bills in what has left hundreds of patients in hospitals high and dry.

When Kenya announced its first case of coronavirus in March, the Insurance Regulatory Authority (IRA) said it had met with players in the industry and agreed to cover bills for patients despite the World Health Organization (WHO) classifying Covid-19 as a pandemic.

The IRA said in a statement that it had held meetings with Association of Kenya Insurers (AKI) chief executive Tom Gichuhi and had agreed that insured victims would be covered.

“The public is hereby assured that the insurance companies will continue to provide their services to policyholders affected or infected with the virus,” said the regulator.

TURNING AWAY PATIENTS

But it appears all that was just public relations. On the ground, things are very different.

Insurers are turning away patients in droves, who despite having hundreds of thousands of shillings still unsent on their medical covers, on grounds that the classification of the Covid-19 disease as a pandemic meant that patients have to pay for their bills.

Last week, Atieno* went to a Nairobi hospital when her child had flu, sore throat and blockage of the nose. When they got to the reception, they were told that the directive from the management is that any patient seeking healthcare at the facility has to be tested for Covid-19, however, patients have to pay in cash Sh10,000 for testing. This is before they start treatment.

Being that Ms Atieno also had flu-like symptoms, she decided to test along with her son. She paid Sh20,000. She had an insurance cover that was not able to carter for the expenses.

She is not alone, Awino* also experienced the same when she went to a hospital and contacted her insurer after a test is done and all she was told that they only cover tests in public facilities.

“Our insurance advised us. If you get tested in a private hospital and turn positive they will send an ambulance to take you to a government facility and after treatment is done, one will pay cash and then claim from the insurance, however, it is unlikely that one would a refund,” says Ms Awino.

CIC Insurance Group and APA Insurance Limited have already communicated the same to their clients that they will only foot bills incurred in public facilities.

As they refuse to pay, a number are announcing double-digit profits and handsome dividends to their shareholders.

TESTING FACILITIES

Joseph Gisemba, a player in the sector says some insurers are only paying if they are forced to do so under the WIBA Act since employees can get it while on duty or at work.

But the majority of the insurance companies in Kenya are not paying. The few who are paying have specified the government hospitals and selected private ones that a patient has to be admitted in. However, one must pay an extra premium over and above what they were paying before to enjoy this cover.

Ironically, the said public hospitals are almost full with most of them not conducting Covid-19 testing.

The government has a task to increase the number of testing facilities accessible to a common Kenyan.

As the government stopped the walk-in clients to some of the public testing facilities for Covid-19, Kenyans are only left with private facilities with exorbitant charges.

Surprisingly, most insurance companies do not cover Covid-19 testing, the cost of isolation and quarantine without treatment in private facilities. The facilities charge between Sh8,000 to Sh10,000 while in public ones it would cost at most Sh1,000.

To complete the about-turn, last week the regulator adopted proposals from insurers to drop coverage in private institutions on fears of increased expenses related to the respiratory disease that could push them into losses.

The IRA told the Senate that insurers will not pay for treatment in private hospitals where bills range from Sh600,000 to Sh1.2 million.

Instead, they will cover expenses incurred in public hospitals where bills for treatment of the infectious virus are estimated at Sh135,000, the regulator told lawmakers in a statement.

“The insurance the industry will pay for testing and treatment offered in government hospitals.

These will include facilities run by the central government and county governments,” Godfrey Kiptum, IRA chief executive, told Senators. “Persons treated in private hospitals will be requested to make their arrangements”.

This is a win for insurance firms that had been meeting to develop a joint response to a March directive by the IRA that all Covid-19 claims be settled. However, it is a loss for their customers as it dims hopes of their treatment in private hospitals.

The government has also changed its testing strategy, a move that will affect many who rely on free screening. This is as coronavirus cases continue to surge.

DONATED KITS

Some of the State testing centres, including the National Public Health Laboratory Services, Kenyatta National Hospital and the Kenya Medical Research Institute are no longer testing the public.

The government no longer conducts free mass testing as it used to. In a memo to all directors and heads of departments, for example, senior director of clinical services at KNH, Dr Irene Inwani, said following the decision that Mbagathi isolation unit will only admit Covid-19 confirmed cases, the unit will no longer handle any suspected cases or screen the public.

Kemri, on the other hand, announced it would no longer collect Covid-19 samples for testing, but will instead test samples from designated testing centres following claims that private facilities were charging for tests conducted at the agency using donated kits.

According to the World Bank data, millions of Kenyans cannot afford to pay for health services at public or private clinics. Even with public health insurance, only 20 per cent of Kenyans have access to some sort of medical coverage.

44 MILLION

With the population at over 44 million and rising, it means as many as 35 million Kenyans are excluded from quality health care coverage. Besides, a quarter of total spending on health care comes from out-of-pocket expenses.

“Ideally, when I am insured by an insurance company, I am at liberty of choosing which hospital to be treated in whether private or public regardless of what I am suffering and it is only after I exhaust my package, then I am required to top up, what’s the need for paying for the package when I cannot use it when I need it the most?” asked Ms Atieno

The AKI, the insurers’ lobby group, had said the insurers faced great uncertainty if they continued to settle open-ended claims.

Since the first case of coronavirus was reported in Kenya on March 13, insurers have received 45 claims amounting to Sh11.9 million. Out of these, Sh1.45 million has been paid, Sh9.8 million is pending and about Sh580,000 is unpayable, Mr Kiptum told the Senate last week.

“This number is expected to increase as the Covid-19 the situation persists,” he said.

Over the years, insurers have adjusted their claims to “direct and physical loss damages” to avoid the growing threat of pandemics with the increasing occurrence of episodes of viral diseases including Ebola.