Kenya’s President William Ruto has approved controversial legislation that will result in the most significant transformation of the health sector in over two decades.
The focal point of his plan is to advance universal healthcare, mandating all workers to contribute 2.75% of their salaries towards a new health fund.
The government asserts that this initiative will enhance the affordability and accessibility of healthcare services for underprivileged Kenyans.
However, it has faced opposition from many Kenyans, who perceive it as a new form of taxation.
They argue that it exacerbates the already burdensome cost of living crisis, despite President Ruto’s campaign promise last year to alleviate financial hardships faced by families.
Furthermore, there are concerns that the new healthcare fund will suffer from corruption, similar to the existing fund, resulting in limited access to entitled health services.
Nevertheless, parliament has supported President Ruto by passing the Social Health Insurance Bill, alongside three other health bills, on Tuesday.
At present, Kenyans contribute between 150 Kenyan shillings ($1; £0.80) and 1,700 shillings monthly to the National Health Insurance Fund (NHIF).
This will be replaced by a new fund, with the minimum contribution doubling and most salaried workers contributing a higher proportion of their pay.
Under the new legislation, every Kenyan must enroll as a member of the Social Health Insurance Fund that replaces the NHIF.
President Ruto argues that universal health insurance will ensure that every Kenyan can seek hospital treatment without undergoing financial hardships.
However, the new laws fail to address the issue of individuals who cannot afford to make contributions.
Kenya’s Health Minister Susan Nakhumicha claims that the new plan is an improvement as it “will allow Kenyans of all walks of life to contribute according to their income”.
She highlights that lower earners currently pay a higher percentage of their income compared to those who are better off.
On the other hand, employers, who are required to match their employees’ contributions, have criticized the 2.75% deduction as excessively high.
They argue that it will negatively impact businesses and worsen the cost-of-living crisis, which triggered widespread protests in Kenya earlier this year.
In June, President Ruto signed the Finance Act, another contentious legislation that introduced a 1.5% housing levy payable by both employers and employees. This measure aimed to facilitate the government’s efforts to provide affordable housing amid soaring property prices that render homeownership unattainable for many urban Kenyans.
Some health and civil society organizations have also voiced their opposition to the health plan, citing the substantial 2.75% deduction as burdensome given the recent surge in fuel prices and living expenses.
“This rate places a significant burden on salaried citizens already struggling to support large households and cover essential services,” stated the Kenya Faith Based Health Services Consortium in September.
All Kenyans will be required to register for the proposed National Social Health Insurance Fund to access public health services, and failure to enroll will result in denied services.
The government will assist Kenyans who cannot contribute to the fund through a budget of 26 billion shillings.
This new fund will supplant the current NHIF, which has incurred substantial losses due to corruption, depriving many paying Kenyans of healthcare access.
Some Kenyans fear that the new fund will have more financial resources, leading to further corruption, while they continue to be denied healthcare by the state.
Critics also worry that the new social healthcare body will allocate a significant portion of the collected funds to administrative expenses, akin to the current NHIF, leaving limited resources for direct healthcare costs.
Additional reporting by Dorcas Wangira
