By Suleiman Mbatiah
Unfounded allegations of widespread fraud at the National Hospital Insurance Fund (NHIF) were grossly exaggerated to justify the controversial shift to the Social Health Authority (SHA), former NHIF CEO Geoffrey Mwangi has revealed, while shedding light on the Fund’s ambitious growth plans that were abruptly disrupted by the transition.
In an exclusive interview, Mwangi disclosed that while fraud existed within NHIF, its scale was far from the crisis portrayed by proponents of SHA. Globally, he argued, about 10% of insurance claims are fraudulent, with health insurance making up 40% of that figure, yet NHIF’s fraud levels were manageable through existing oversight mechanisms.
“The transition was politically driven, particularly profiteering in the procurement of new systems,” Mwangi said, suggesting that the move was less about tackling fraud and more about advancing hidden political and financial agendas.
Before its dismantling, Mwangi said, NHIF had undergone a dramatic transformation, shifting from a passive entity to an aggressive healthcare financier. The 2014–2018 strategic plan replaced what he called a “kingdom” mentality with a “hunter” approach, leading to explosive growth.
Membership, he revealed, surged from 4.7 million in 2014 to 7.6 million by 2018, while revenue skyrocketed from KSh 14.23 billion to KSh 51.53 billion, a 26% annual growth rate. Strategic partnerships with Amref, PharmAccess, and Living Goods, he further revealed, boosted informal sector registrations, while expanded benefits, including outpatient coverage, cancer treatment, and emergency ambulance services, made NHIF a critical player in Kenya’s healthcare.
“We scrapped accreditation fees, onboarded over 7,500 facilities, and increased hospital rebates to between KSh 2,400 and KSh 4,000 per day,” Mwangi recounted. The 2018–2022 strategy aimed even higher: targeting 19 million members and KSh 78 billion in revenue. Though membership fell short at 15.5 million (with only 6.4 million active contributors), revenue exceeded expectations, hitting KSh 84 billion.
However, he recounted, success came with challenges, claims consumed 89% of revenue (KSh 74.7 billion), and employer defaults pushed debt from KSh 117 million to KSh 1 billion.
Despite those challenges, Mwangi insisted that NHIF had been on a sustainable path, with fraud being a manageable issue rather than a systemic collapse. He claimed that the exaggerated fraud narrative had been used as a pretext to dismantle NHIF. He argued that the real focus should have been on enhancing service delivery, not exploiting flaws to push a new system.
The transition to SHA, however, has been marred by poor implementation and public distrust. Key NHIF programs, Edu Afya, Linda Mama, and Inua Jamii, have been scrapped, and revenue has plummeted to an average of KSh 4–5 billion monthly, down from its KSh 84 billion peak.
“SHA lacks credibility because beneficiaries don’t feel ownership. The government failed to communicate its value,” Mwangi argued, warning that without public trust, SHA’s target of Sh200 billion in revenue will remain elusive.
While President William Ruto has hailed SHA as a success, citing KSh 129 billion mobilised for healthcare, Mwangi questioned whether the new system can replicate NHIF’s reach, “a thriving institution whose growth was cut short under questionable circumstances.”
