House committee clears Safaricom consortium in SHIF rollout

A House committee has cleared a controversial decision by the Ministry of Health to award tenders for provision of the Integrated Information Technology System For Universal Healthcare, to Safaricom and two other companies, despite the absence of a formal letter of consent from the Office of the Attorney General.

According to a statement read by the Chair of the National Assembly Committee on Health Robert Pukose, the Ministry of Health had furnished the committee with a formal clearance by the Attorney General, “thereby complying with all the legal requirements that were intended to safeguard public money through an assurance that there is value for money in any government transaction.”

Pukose further acknowledged that there were questions from the committee on Safaricom’s role in the consortium that also involves Apiero Limited and Konvergenz Network Solutions Limited.

Pukose said in their defense, the Ministry satisfied the committee with their justification on the same, saying:  “The Ministry of Health identified Safaricom PLC as a strategic partner and gave Safaricom PLC a request for proposal for the tender.”

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The declaration comes amid questions on the involvement of the two companies, which are said to be only two months old, since registration.

The committee also ignored questions that have emerged over the mind boggling Sh104 billion, the sum for IT set up for the new authority’s service with Pukose saying the ministry had issued a satisfactory answer.

“The amount is not solely dedicated to Social Health Insurance but includes various components aimed at delivering a comprehensive and integrated healthcare system for Kenya,” he said.

“These components encompass the development of a Health Information Management System, a Health Information Exchange platform, core business services such as provision of telemedicine and track and trace for pharmaceutical products, the SHA Insurance Management Platform, an Enterprise Resource Planning (ERP) system, National Logistics and Supply Chain Management software, a learning platform, a data lake and analytics system, as well as the necessary digital health infrastructure to support these systems,” he added.

He admitted that questions on possible conflict of interest had also been raised, with the involvement of Dentons Hamilton Harrison & Mathews pacing the conversation.

Pukose, however, clarified that according to the Ministry, the law firm wasn’t involved in conducting due diligence. He said that was done by Kaplan & Stratton Advocates. 

With the position, this paves way for the implementation of the Health Insurance Scheme, with most of the queries left hanging.

A media event that sought to demonstrate how the new Integrated Information Technology System was to work failed to take off on Friday, after the PS in charge of Health Services, Harry Kimtai, and officials from the companies failed to show up.

Another event, in which KEMSA was to launch Health Products and Technology in preparation for the rollout, was also postponed from 8am to 2pm yesterday. It was later noted that Health CS Deborah Barasa was held up at Parliament.

Meanwhile, as the rollout of the new Social Health Insurance Fund begins today, uncertainty surrounds how non-salaried Kenyans will contribute to the scheme, with more concerns emerging about the state of preparedness for the new scheme.

The Ministry of Health was taken to task by the National Assembly Departmental Committee on Health on Means Testing Instrument (MIT) over elements to be used to determine how much individuals will contribute to the scheme.

MPs questioned the scientific process that was used to determine parameters used to cap pay for the non-salaried.

This came as it emerged that piloting for MTI was done only in eight counties, with a sample size of 2,000.

Social Health Authority (SHA) chairperson Dr Mohamed Abdi said the eight counties are Turkana, Tana River, Narok, Migori, Bungoma, Bomet, Kiambu and Nairobi.

“We conducted means testing in eight counties, and we have accurate data. We assure you we will not face challenges like those reported at the Ministry of Education,” Dr Mohamed told the Pukose-led committee 

Ndhiwa MP Martin Owino took issue with the sample size saying 250 per county, within the selected eight was not adequate to come up with conclusive findings on contributions by non-salaried people.

Owino gave an example of Bungoma County, saying the county has a population of two million people.

“When scientific process is compromised, it means the whole process will crumple. This (piloting) should have been done in all the 47 counties instead of the eight,” observed the MP.

CS Barasa, who had been summoned by the committee to give state of preparedness, said during registration, an individual undergoes means testing test and the tool calculates how much they will pay to the scheme.

“There is an insurance funding that shall be used to supporting, that has 0 per cent interest to allow Kenyans pay for the coming 12 months,” said Barasa.

However, the response did not satisfy the committee, with Pukose asking if money will be deducted during payment to the scheme, using the means testing.

SHA Acting CEO Elijah Wachira was forced to use an example of a cow in Githunguri, saying it has different income implications, as compared to owning the same in Narok.

Wachira explained that the material used to construct a house in different localities in the country might also not be the same, and therefore is not a variable that can determine how much someone should pay to the scheme.

“The algorithm is informed by more parameters. I assure the House that the science behind is able to give the households,” Wachira told the committee.

He added: “Parameters are picked, and repeated. Kenyans shall pay a number ranging from Sh300 depending on determinants.”

Dr Barasa added that Kenyans who feel that they are deducted more than what they should pay can appeal.

Director General of Health Dr Patrick Amoth said the ministry looked at household expenditure, based on Kenya National Bureau of Statistics data.

The ministry would then place additional indicators and concluded that the low income contribution was not being overestimated.

Means testing, he said, was conducted by the Ministry of Health with support from health economists.

“We are confident on the accuracy level of the MTI system which we believe is 96 per cent accurate. From where we stand, the MTI we have conducted will not overestimate the premium of those in the poor households,” said Amoth.

According to SHA’s general regulation 2024, non-salaried Kenyans will remit their pay to the scheme annually, an issue that raised debate among legislators.

PS Kimtai defended the model saying the ministry is making provision of the insurance premium financing for low income earners.

“The system will have insurance premium financing where contributors will seek alternatives through Saccos and co-operatives to settle their annual premiums,” said the PS.

Kimtai emphasised that during registration process, a contributor answers several questions, and at then, they will generate an amount on what they are expected to pay to the scheme.

 “Annual income estimated given by means testing tool will be 2.75 per cent, is what will be applied. A contributor will pay according to their ability, emphasised the PS.

The payment is capped at 2.75 per cent.

Mogotio MP Reuben Kiborek said Kenyans do not have enough information on means testing and the new scheme in general.

“What is the intelligence of means testing? How intelligent is the means testing?” posed Kiborek.

Kimtai maintained that new registration - from NHIF to SHA - is being done afresh.

By September 29, at least 2.16 million Kenyans had registered with SHA.

“If you have not registered, the process shall be done at facility level, and if not able, the facility shall help you,” said Kimtai.

He added: “We have made a provision of assisted registration. Whether registered or not, you’ll get services. We are changing form manual to digital registration. This will identify using your ID, benefits and shall continue having services, billing shall be done,”.

But Kitutu Chache MP Anthony Kibagendi questioned preparedness to rolling out of the new scheme.

 “I want to tell you, we are not ready. This is the truth. We are not ready to transition. I want to tell you from tomorrow we will see failure on your part because of the rush,” said Kibagendi.

Further, the MP raised an issue with value for money that Kenyans are going to get with SHA, adding that the deduction capped at 2.75 per cent is high.

 But SHA chairperson in his part defended the 2.75 per cent, saying that NHIF had a regressive regime.

 “The less you earn, the more you pay as a percentage. It was punishing the poor. You earn Kshs 5,000 and pay Kshs 500 that is 10 per cent. The law has put a proportionate equivalent to your earnings so that you pay a proportionate of your income,” said Dr Mohamed.

 CS Barasa further explained to the committee that this is a health financing pool.

 “It is a pool of finances to cater for health services for all Kenyans. We are at initial stages. Just like a child, we can’t have a robust system at once,” said Barasa.

 She added, “We shall have challenges with system, digitalisation, but let us not throw away the baby with the  bath water. This is why we are calling the committee to support us. UHC is important when we think of the needy and vulnerable in the country,”.

 Amid uproar among Kenyans on the deductions done to the new scheme, in comparison with private insurance, Kimtai said Kenyans have an option to have private insurance.

 However, all Kenyans, according to him, must be enrolled to SHA as it is a social insurance cover.

 “We are telling Kenyans they still have option for private insurance. Under SHA, this is a national scheme and all of us should contribute to the scheme. The 2.75 per cent is what everyone shall use. If you feel you need a private cover, the insurance law does not prevent you,” explained the PS.

 The ministry, he said, is expected to collect at least Kshs 148 billion from SHA deductions, an amount that might be more, depending on successful payment, and that Kenyans shall get more benefits in future.

 The ministry allocated Kshs 4.1 billion for Primary Health Fund, and has so far received Kshs 1 billion, of which counties are expected to place procurement of commodities at KEMSA

 About NHIF employees, Kimtai said only those found to be involved in fraudulent activities are being investigated.

 He maintained that current members of staff are staff will transition to SHA, so long as they do not have issues on misappropriation of public funds.

 Currently, there are 485, out of 1,743 workers at NHIF supporting SHA roll out.

 “No staff of NHIF has been told not to go to work. All are assigned roles based on new processes. Come tomorrow as we prepare for the new system, we have identified these officers, who have been trained,” said Kimtai.

 Wachira added, “For avoidance of doubt, staff of the fund continue in service, under their current terms, until NHIF has concluded the process as per the transition process. Staff of NHIF can be utilized by SHA to carry out activities”.