Hospitals Are in Financial Distress and Receive Low SHA Payments - Report

A report by the Rural & Urban Private Hospitals Association of Kenya (RUPHA) has revealed that many hospitals are facing financial distress over pending NHIF debts and delayed payments by the Social Health Authority (SHA).

In its report released on Wednesday, June 4, the association detailed that 91 per cent of 477 surveyed hospitals noted that they were facing financial challenges.

The most affected hospitals were faith-based facilities and private facilities.

Consequently, the hospitals were facing issues in paying suppliers and covering their operational costs.

Additionally, the report indicated that a few hospitals were receiving repayments for the treatment of patients.

"Only 20 per cent of Primary Health Care (PHC) accredited facilities received payments for each month in the quarter January–March 2025; 45 per cent received no payments at all," read the report in part.

"63 per cent of PHC-contracted facilities said the payments were 'less than expected', with dissatisfaction highest among FBOs - faith-based organizations (83%)."

However, it was noted that there were some improved reimbursements for public hospitals.

As a result, the hospitals are calling on the government to ensure timely payments by the authority in addition to settling outstanding NHIF debts.

"Reduce SHIF delays by automating claim adjudication, providing feedback dashboards, and maintaining open provider–payer communication," read the report in part.

"Without timely and coordinated interventions, Kenya’s health system risks systemic disinvestment from critical service areas, especially surgery, PHC, and inpatient care. This report provides an evidence-based roadmap to restore providers’ confidence and ensure the financial viability of the sector as SHA’s rollout matures."

Currently, the government is yet to clear close to Ksh30 billion that was owed to the hospitals by NHIF.

According to the government were fictitious, prompting the government to form a technical team to verify the claims.

"By the time the NHIF was wound up on November 22, 2024, it had a whopping debt of KSh33 billion, affecting the ability of health facilities to provide services under the Social Health Authority (SHA)," President William Ruto announced.

"To comprehensively deal with this challenge, the government has resolved to pay all hospitals with total claims of Ksh10 million and below in full, representing 91 per cent of all facilities that were contracted by NHIF."