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NHIF challenged to post audited financial statements on website
Posted in General, Health Financing by Alisha Rahemtulla on June 12th, 2012

A recent study by the International Budget Partnership (IBP) has recommended that Kenya’s National Hospital Insurance Fund (NHIF) should be more public about their affairs and post on its website its audited financial statements for the past 10 years. IBP together with Twaweza Ni sisi, a citizen centered initiative focusing on large-scale change in East Africa, presented the budget brief titled “Healthy Ambitions? Kenya’s National Hospital Insurance Fund Must Become More Transparent if it is to Anchor Universal Health Coverage” to journalists and stakeholders in Nairobi on May 28,2012.

Mr. Jason Lakin from IBP presented an overview of the findings. The IBP study sought to determine “whether NHIF communicates financial and policy information to the public in a clear, consistent and transparent form, as befits a major state corporation with ambitions to provide universal health coverage.” IBP looked for information on benefits and revenues, subsidies, investments, accountability and details on official NHIF policies. After searching for several months, IBP found that other than minimal information on NHIF policy, financial information was not readily available on the NHIF website, or in person at the NHIF office. In order for IBP to receive any financial information from NHIF, they were asked to sign a confidentiality agreement. IBP believes that this defeats the necessity for freedom of information as outlined in the Kenyan constitution.

IBP was able to get some information from audit reports supplied by the KENAO (Kenya’s supreme audit institution), the government’s Annex of Estimates of Revenue and Expenditure of State Corporations 2011-2012, and other related reports, such as the Deloitte review of NHIF. However, according to IBP none of this information is easily accessible for the general public. Through its research, IBP made two main recommendations:

1. NHIF should immediately post on its website its audited financial statements for the past 10 years.

2. The Treasury should immediately post the annex on state corporations to its website, but should also revise it to include additional information.

The IBP presentation was followed by statements from Channukah Africa Research Centre, Morris Moses Foundation and Institute for Economic Affairs (IEA) who discussed the implications for parliamentary, health sector and civil society oversight. IEA mentioned that part of the problem could be public ignorance about corporate objectives and ability to understand financial figures. It was also stated that the NHIF Board members had conflict of interest, and therefore were not aligned with public interest.

An interactive session with the media followed the presentations. There was some concern about whether the findings of the 2011 Deloitte audit report had been acted on, and whether IBP’s report provided any additional information. Mr. Lakin responded that NHIF had contracted Deloitte to write the report, so Deloitte had access to a lot more information than IBP did.  Thus from a citizen’s perspective, IBP’s conclusion that NHIF lacked transparency still held. IBP also claimed that the Deloitte report is also not easily accessible to the Kenyan public.

The media was also concerned about whether IBP found any information on why NHIF chose capitation for its outpatient pilot, and why certain capitation rates were set.  Capitation was chosen based on the results of a NHIF pilot study, but IBP could not find this study. IBP also stated that its research began before the NHIF scandal was revealed, so the capitation study was not a major focus.

IBP works with civil society organizations (CSOs) in over 100 countries “to fight poverty and improve governance by reforming government budget systems and influencing budget policies.”

In 2012, the German Development Cooperation through the GIZ Health Sector Programme,  has plans to implement “Health for all Kenyans through Innovations - Social Health Insurance (HAKI-SHI)” in Kericho. For this pilot, NHIF - being the only parastatal organization having the mandate of providing health insurance – is planned to be responsible for providing inpatient services to 6000 of the poorest-of-the-poor households in Kericho East. Currently, NHIF manages 4.7% of total public health resources, and will be managing even more public resources if Kenya moves towards universal health coverage. Thus ensuring transparency and appropriate reporting is essential both for the HAKI pilot, and for the future implementation of a national social health insurance, thereby addressing the Government of Kenya’s vision of covering Kenyans through universal health coverage.


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