The National Health Insurance Fund (NHIF) is embroiled in yet another financial scandal after it was revealed it could not explain how Sh400m was used beyond the loss of insurance coverage for police officers.
The Spending of the voluntary amount was flagged by Auditor-General Nancy Gathungu in the Home Office accounts, under whose mandate the National Police Service falls, for fiscal years 2018-19 and 2019-20.
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Failure to address the matter has resulted in the audit request reappearing in the Department’s audited accounts for the 2020/21 financial year currently before Parliament. The scandal has led the National Assembly’s Public Accounts Committee (PAC) to subpoena NHIF Chief Executive Officer Peter Kamunyo and Inspector General of Police (IG) Hillary Mutyambai to explain how the money was used. The subpoena comes after Interior Minister Karanja Kibicho told PAC chaired by Ugunja MP Opiyo Wandayi that the NHIF boss has not yet explained how the funds have been used, despite asking for the necessary documentation to support the spending
Although Mr. Kamunyo had previously said that the amount was used to pay officials who sought medical help after overstaying their health insurance. dr Kibicho told the committee that the NHIF could not provide any documentation to support the spending, including the list of beneficiaries. p>
Read: Government to cushion police officers who deplete NHIF coverage
“We are struggling to get information from the NHIF to prove use of the funds,” said Dr. Kibicho to PAC, a House oversight committee. NHIF’s failure to comply has resulted in the Home Office being adversely quoted by Ms Gathungu.
“We would like this committee to step in because you are the ones responsible and we don’t understand why NHIF would be unable to address small things like [providing] information,” said Dr. Kibicho.
PAC has summoned Mr. Kamunyo and Mr. Mutyambai to appear before him tomorrow.
PAC members Dr Otiende Amollo (Rarieda) and Dr. Wilberforce Oundo (Funyula) regretted that the matter dragged on for years because NHIF failed to provide the PS with the required information.
“It is important that we specifically subpoena the CEO of NHIF should come and explain to this committee why he is not providing the necessary information to the PS,” said Dr. Amollo. dr Ojiambo noted that the matter has been recurring for a long time and now needs to be resolved.
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” If NHIF cannot account for that money, then the CEO must be held accountable. He has to be willing to pay it back,” said Dr. Ojiambo. The excess damage amount was part of the Sh4.79 billion comprehensive police medical insurance awarded to NHIF on 26 September 2017 in a two-year contract ending 30 September 2019, later extended to 30 June 2020 .
The deal provided for Sh200 million in gratia funds to be allocated each fiscal year in excess of the contract amount for the duration of the contract.
The voluntary amount was intended to cushion police and law enforcement officers who had exhausted their annual coverage limits but required treatment.
According to the contract document signed by the Home Office, Treasury and NHIF, the amount was refundable at the end of the contract term if not used. The contract also provided that any claim for excess damage coverage could only be approved by IG. This means NHIF cannot use the money without IG’s approval.
NHIF has not provided any evidence that Mr. Mutyambai approved the spending. This comes as it was revealed that Dr. Kibicho and Mr. Mutyambai were frustrated because Mr. Kamunyo did not respond to their requests for explanation.
For example, in a letter dated February 19, 2021 to the NHIF chief, Mr. Mutyambai shared with Mr. Kamunyo that any explanation to issue amount must include beneficiary name, medical facility, amount, member name and date of medication, profession, rank, and total deductible.
Refer to :NHIF in hot water due to delays in service from police and prison officials
As part of the recovery effort, Dr. Kibicho PAC informed that the Ministry has now decided to withhold the insurance premium payable to the NHIF.
At the time the Sh4.79 billion health insurance contract for the police was signed , NHIF was not a registered insurance company under the provisions of the Insurance Act.
Section 19 of the Insurance Act requires that any insurance provider operating in the country must be registered with the Insurance Regulatory Authority (IRA). However, through a notice in the Official Gazette on April 17, 2020, the Minister of the National Treasury, Ukur Yattani, exempted the NHIF from this provision of the law, allowing the fund to effectively engage in commercial insurance business.
Last year the government granted mandated NHIF to provide health insurance to civil servants, police officers and law enforcement officers.
The government cited the high cost of private insurance and the lack of structures to provide such health insurance on a large scale as reasons why NHIF was favored.
On June 30, 2021, the contract was awarded to NHIF for Sh3.29 billion. Mr. Kamunyo, the accounting officer at NHIF, when appearing before him for the audited financial statements for 2019/20, told PAC that he was discussing the matter with Dr. Kibicho settled allegations he refuted.
In his May 5, 2021, letter to NHIF chief Dr. Kibicho, requesting a detailed report on spending by May 6, 2021. according to dr Kibicho has not received a reply to this letter.