Kenya’s President William Ruto has approved controversial legislation that will see the biggest shake-up of the health sector in more than 20 years.
His plan revolves around promoting universal healthcare. The new plan also requires all workers to contribute 2.75% of their salaries towards a new health fund.
The government says it will make healthcare more affordable and accessible for poorer Kenyans.
But it has proved unpopular with many Kenyans, who see it as a new tax.
They say it is the latest in a series of measures that Mr Ruto has introduced, worsening the cost-of-living crisis. This is despite the fact that he won elections last year with a promise to ease the cost of living.
Some also fear that the new healthcare fund will be beset by corruption, like the existing (NHIF) one. This will also mean that Kenyans may be unable to access their right to the health services they are entitled to.
Parliamentary backing for UHC bill
But parliament has backed Mr Ruto, passing the Social Health Insurance Bill, along with three other health bills.
Currently, Kenyans pay between 150 Kenyan shillings and 1,700 shillings monthly to the National Health Insurance Fund (NHIF).
However, the NHIF will be replaced with a new fund. The minimum contribution is also set to double. Furthermore, most salaried workers will be contributing a higher proportion of their pay.
Kenya’s Health Minister Susan Nakhumicha has said that the new plan is better as it “will allow Kenyans of all walks of life to contribute according to their income”.
She said lower earners currently pay a higher percentage of their income than the better off.
Employers oppose the new health plan
Employers, who are required to match their employees’ contributions, have opposed the 2.75% deduction as too high.
They say that it will hurt businesses and aggravate the cost-of-living crisis, which fuelled a wave of protests across Kenya earlier this year.
In June, Mr Ruto signed the Finance Act, another unpopular piece of legislation. The Finance Act 2023 introduced a 1.5% housing levy payable by both employers and employees. The levy was meant to help the government to provide Kenyans with affordable housing.
Some health and civil society organisations have also spoken out against the health plan. They said that the 2.75% deduction is substantial, considering the recent rise in fuel prices and living costs.
“This rate takes a lot more from distressed salaried citizens, whose incomes support large households of family and services,” the Kenya Faith Based Health Services Consortium said in September.
Kenyans must register to new health fund to access services
Kenyans will be required to register with the proposed National Social Health Insurance Fund to access public health services. Those who fail to enroll will be denied services.
The government will help Kenyans who cannot contribute towards the fund through a kitty of 26 billion shillings.
The new fund will replace the current NHIF, which has lost billions of taxpayer-contributed funds to corruption, denying many paying Kenyans access to healthcare.
Some Kenyans fear that the new fund will have more money, and there will be more corruption, while they will still be denied healthcare by the state.
Critics also fear that the new social healthcare body will spend most of the collected funds on administrative expenses like the current NHIF, leaving few resources for direct healthcare costs.
