The Social Health Insurance Fund (SHIF) is replacing the National Hospital Insurance Fund (NHIF) in 2024, with the NHIF expected to be completely phased out by October, 2024. Salaried Kenyans started paying 2.75% of their salary, the mandatory SHIF deduction, on March 1, 2024.
SHIF is the new universal health cover introduced by the Kenya Kwanza government. It is meant to ensure free access to health care especially for the elderly, disabled and other vulnerable Kenyans in all public hospitals.
SHIF: Social Health Insurance Fund to replace NHIF in 2024
The SHIF replaces the NHIF that has been in operation for over 55 years and its implementation is led by Health CS Susan Nakhumicha. However, the new fund will become operational in July, giving the government enough time to collect funds and prepare for the phased transfer from NHIF.
Unemployed Kenyans are expected to contribute a minimum of Ksh 300 to the SHIF.
How the NHIF began
In 1963, Attorney General Charles Njonjo made a suggestion to the then new African administration to create a national health scheme that would equally cater for all people in Kenya: Africans, Europeans and Asians. Until then, Africans did not have a health fund and were therefore unable to access healthcare in big and expensive hospitals – their only option was government hospitals that were overcrowded and lacked basic equipment.
But Europeans had the European Hospital and Treatment relief Fund while the Arab Fund Authority catered for Asians.
In 1965, Sessional paper No. 10 proposed the establishment of NHIF.
NHIF was established in 1966
In 1966, the NHIF was established. The State Parastatal was established under CAP 255 of the Laws of Kenya. It was to be run by an Advisory Council that was to be appointed by the Health minister.
However, from 1966 to 1972 NHIF was only for salaried Kenyans who were earning at least KSh 1,000. Their monthly contribution was KSh 20.
This meant that most native Kenyans still had no access to the fund, and limited access to good hospitals.
In 1972 the NHIF Cap 255 was amended, adding self-employed Kenyans to the health cover scheme and with a monthly contribution of 60 KSh. But this was later adjusted to KSh 160.
In 1998 NHIF became a State Corporation
The NHIF Act No.9 of 1998 replaced Cap 255 and caused the fund to be transformed into a State Corporation. NHIF became under the management of an all-inclusive Board of Management with representation from all major stakeholders and interest groups.
By the end of the health scheme in October 2024, NHIF will have over 14 million registered members. Of these, about 5 million are active members. NHIF also has over 20 million beneficiaries. But the active beneficiaries are about 11 million.
But unlike NHIF that had voluntary membership from the informal sector, contributions to the new SHIF is mandatory. The new fund is therefore going to have many more active registered members and beneficiaries.
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