Medical fraud in counties now tops the list of scams against the National Hospital Insurance Fund (NHIF), the State agency has revealed.
The scam involves healthcare providers claiming to have performed various procedures during surgeries when in fact they did not.
An internal assessment by NHIF reveals the insurer is paying up to five times the medical premiums it receives from subscribers, wiping out its revenues.
The results show a mixed picture, with some of the schemes having a favourable benefit payout ratio and others having financially unviable payouts.
Counties like Mombasa, Kitui, Lamu and Taita-Taveta have received benefits more than the amounts they have paid at 143 per cent, 213 per cent, 192 per cent and 471 per cent, respectively. Taita-Taveta has received benefits more than four times the amounts paid in premiums.
The report also indicates that Kirinyaga had negotiated a contract of Sh34 million but had not made any payment for it, though scheme members were receiving benefits.
“However, given the trend in growth in premiums and claims, when future revenues and claims for the county schemes are projected, claims will outstrip revenues by 2026, making the county schemes unsustainable,” the report indicates.
The greatest predator in the county medical scheme is inpatient expenses, which have risen 200 times in just three years.
“Over the years, the inpatient expenses have increased from Sh1.66 million in 2015 to Sh203.98 million in 2018, and have been the biggest driver of cost except for 2015 and 2016, when the group life and last expenses were the biggest driver,” the report shows.
Dr Samuel Nyandemo, an economics lecturer at the University of Nairobi, said this is a clear indication of fraud.
“This is a format for stealing and the anti-corruption agency needs to probe it because, clearly, there is no ceiling and counties have decided to use this as an avenue for making money,” he said.
NHIF Board vice-chairperson Roba Duba has admitted that the fund is exposed to cartels and other vested interests, which it is fighting.
“We have seen a case of a member going for surgeries 167 times in one year; this is an indication that members are stealing their own money in collusion with facilities,” he said.
Another factor likely to cause the collapse of NHIF is informal sector workers, who make voluntary monthly premiums at a flat rate of Sh500 per month per household.
“Projections for revenues and expenses for the national scheme show that it is likely to start running in deficits by 2020,” the report indicates.