KNH owed Sh662m by patients: Auditor

What you need to know:

  • A report by Auditor-General says KNH management failed to explain how it intends to recover the long outstanding debts.
  • The hospital had stated a debt of Sh56.7 million due from the insurer, but other records showed the amount as Sh445 million.
  • The hospital acknowledged the loss, explaining that it arose from unfavourable contracts with NHIF.

The Kenyatta National Hospital is owed Sh662 million by patients who left without paying, the Auditor-General’s report for the 2016-2017 financial year reveals.

This comes even as the National Assembly considers an amendment by Nyando MP Jared Okelo on the Health Laws (Amendment) Bill, 2018 to stop all hospitals from detaining anyone with unpaid bills.

A report by Auditor-General Edward Ouko tabled in the National Assembly says KNH management failed to explain how it intends to recover the long outstanding debts.

MUTUAL AGREEMENT

Mr Okelo, in his proposed amendments, wants all hospitals, both public and private, not to detain anyone over bills but instead reach a mutual agreement with parties involved on how to settle the bill.

The lawmaker wants the Medical Practitioners and Dentists Act 253 amended to compel any health personnel or facility pay up to Sh5 million fine or serve a jail term of up to five years for detaining discharged patients or bodies of those that have died.

“No health institution in the country shall detain or otherwise cause, directly or indirectly, the detention of the body of a patient who died after or during treatment for reasons of non-payment, in part or in full, of hospital bills or any other medical expenses,” reads part of the proposed amendments.

NHIF REMITTANCE

“Patients who have fully or partially recovered and who are discharged or wish to leave health institutions but are financially incapable of settling their hospital bills or other medical bills shall be allowed to leave the health institution,” the amendments further read.

The audit report also points out that the National Hospital Insurance Fund (NHIF) owes the hospital Sh445 million, which the insurer failed to remit after the hospital provided medical services to its members.

SH445 MILLION

The hospital had stated in its financial statements a debt of Sh56.7 million due from the insurer, but other records showed the actual amount as Sh445 million. The management could not explain the disparity.

According to the report, the hospital entered into a contract with NHIF in August 2008 to treat the latter’s members at a rebate rate of Sh2,400 for inpatient care per day. However, in August 2016, the rebates were increased to Sh4,000 per patient.

The auditor asks why it took the hospital eight years to review the hospital’s contract.

Had the contract been reviewed, the losses incurred would have been avoided, Mr Ouko says.

BAD CONTRACT

The hospital acknowledged the loss, explaining that it arose from unfavourable contracts with NHIF as bills incurred by patients were higher than the reimbursement.

The hospital says that despite the unfavourable contract with NHIF, it continues to offer services to its members following a government directive.

“The hospital has negotiated new contracts with NHIF which include expanded services initially not covered such as oncology at a fee for service, CT scan and renal services,” says the management in their response to the audit queries.