HOSPITALS FACE BAN FOR FALSE NHIF PAY CLAIMS

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The National Hospital Insurance Fund (Amendment) Bill, seeks to protect the scheme from fraud and mismanagement. It has laid out varied penalties, including, that those hospitals and healthcare providers found processing fake claims, will be permanently stripped of their accreditation.

In particular, the new act, that was recently passed into law and is awaiting the President’s signature provides that, “Any declared hospital which knowingly or fraudulently alters or falsifies any information with the intent to defraud the board or to obtain any benefit that it is not entitled to under this Act, commits an offence and is liable on conviction, to removal from the register of empaneled and contracted healthcare providers,”
NHIF loses up to Sh16.5 billion annually through fraudulent and fictitious claims from individuals and hospitals. These fictitious claims are mainly filed for surgeries, MRI and CT Scan procedures.

The NHIF has in recent months, The NHIF State insurer had enlisted detectives from the Directorate of Criminal Investigations to probe the loss of up to Sh500 million every month through fictitious claims. Its countrywide investigations flagged a number of accredited hospitals, for padding up numbers to increase their payouts.

As a result, 15 health centres based in Nyamira, Homa Bay, and Migori counties, have since been blacklisted for defrauding the scheme of Sh27 million between January and March 2021. Further investigations showed that a Kisumu-based hospital used fake school rubber stamps, fake birth certificates, and school letterheads to make claims to the NHIF.

NHIF CEO Peter Kamunyo has decried this state of affairs saying, “We have been experiencing fraudulent cases and attempts worth a lot more, which is quite disappointing,”

The current penalties for defrauding the NHIF, are fine of Sh500,000 or suspension from the State-backed insurer for not more than five years. These lenient penalties have now been replaced with tougher sanctions, as law makers have also doubled the fine for fraudsters, caught impersonating NHIF-enrolled members.

Impersonation in this instance, involves NHIF members giving their cards to patients, not eligible for treatment using the State insurer’s services. It is commendable, that the State had pushed for a Sh10 million fine or three years in jail or both for those found guilty of impersonation in the wake of the increasing losses.

Related penalties include that; persons found fraudulently using the scheme to settle medical bills, face a Sh1 million fine or a two-year jail term or both. Also, under the NHIF Act, hospitals that do not inform patients that they have been blacklisted from the cover, cannot charge patients amounts that are more than the difference between the actual cost of the service, and what the NHIF would have contributed, had the hospital not been suspended.

In a bid to improve on its service delivery, the scheme had earlier in June 2021, rolled out mass biometric registration for its 8.9 million members and their dependents. This was also because the use of the NHIF card and national identity card as the mode of identification, had for years provided loopholes for fraudulent claims.

The State-backed insurer initially targeted having all its accredited hospitals switch to fingerprint identification by July 2021, but faced opposition from its service providers, especially in the rural hospitals. The hospitals claimed that NHIF had rolled out the fingerprint registration without consultation. They also claimed that the scheme had given a short compliance notice, thereby blocking the public from accessing medical services.

NHIF however stated, that the e-claim system was not new and had over the years, been used by contracted hospitals to request for pre-authorizations, before offering services to NHIF members and their beneficiaries
Even as the fund improves on its management and operations, it must be noted that it has continued to support the realization of the Universal Health Care as outlined in the President’s Big 4 Agenda.

In the financial year ended June 2021, the NHIF collected Sh61.53 billion from its 8.998 million active members and paid out Sh54.66 billion in claims. This is an indication of its potential to deliver on its mandate, with the requisite public good will and institutional support.

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