It has been weeks after President William Ruto announced austerity measures following the rejection of the Finance Bill 2024/2025.
The latest to feel the impact is the State Department of Medical Services, which has now requested Parliament to allocate Sh6 billion to facilitate health insurance for low-income households.
Appearing before The National Assembly’s Departmental Committee on Health on Wednesday, Medical Services Principal Secretary Harry Kimtai stated that the department has historically paid health insurance premiums for one million households, covering up to four million individuals who are now unable to afford healthcare.
However, with the proposed budget cuts in the supplementary budget, at least four million Kenyans will be unable to afford healthcare.
“The Primary Health Care Fund is fully government-supported but limits access to services to dispensaries and health centres, with more advanced medical treatments available only upon referral from these facilities,” said Kimtai. “Access to services at this level requires full payment. Failure to fund the indigents’ insurance goes against the spirit of universal healthcare coverage, where equity is a main component,” he added.
He also noted that this would limit access to essential hospital services.
For the financial year 2023/2024, Sh6 billion was allocated to indigent healthcare. However, the budget allocation for the financial year 2024/2025 has been reduced to zero.
“This contradicts the government’s agenda to make healthcare accessible to all, regardless of social or economic background,” said the PS.
Endebess MP, Dr Robert Pukose, who also chairs the National Assembly Committee on Health, asked the State Department to accept the budget cuts, explaining that the rejected Finance Bill 2024, was expected to raise Sh 344 billion.
“Due to this, we must rationalise the budget, resulting in a shortfall of approximately Sh 121 billion. This means the government will have to borrow over Sh220 billion to cover the deficit,” asserted Pukose. “Consequently, we face challenges from the withdrawn Finance Bill, requiring us to rationalise the budget by removing critical budget lines,” he added.
Pukose urged public and state officials, especially heads of parastatals, to be deliberate in their services to the public and the government.
“The budget cuts affect everyone, not just the President and Members of Parliament. It impacts your ability to deliver services to the people of Kenya,” he warned.
PS Kimtai acknowledged that the accounting officers of various ministries, state departments, and agencies are aware of the current situation in the country, emphasising the need to minimise wasteful use of government resources.
“We expect that the referral facilities will benefit from proper organisation and operation of the Social Health Insurance Fund, as they are the biggest losers if the insurance claims are not reorganised,” he said.
He argued that the programmes and legal frameworks the ministry has instituted to reorganise the health insurance system in the country will alleviate or remove referral hospitals’ dependence on the National Treasury.
“We are now working on the costing, and if the reimbursement is done on time, because you have costed, this time we’re trying to cost claims which include the cost of labour, because previously we have only been costing the drugs, medicine, or treatment, but not the labour component,” he stated.
