Sunday, June 10, 2012

Laying out the issues at play over NHIF scam

Sunday Nation 10 June 2012

The Parliamentary Committee on Health finally handed in its report on the National Hospital Insurance Fund (NHIF) scandal, recommending investigations into the role various people played in channelling contributors’ money to organisations that did not have capacity to deliver the required services. The Director of Public Prosecutions has also weighed in with instructions to the police and the Ethics and Anti-Corruption Commission to jointly investigate the scam.

Unfortunately, due to the magnitude of this scandal and the amounts of money involved, it was not completely unexpected that behind-the-scenes manoeuvres would be made to influence the course of the investigations. Allegations have been made about bribery attempts by individuals linked to any of the several players in the scam, targeting members of the parliamentary committee itself. Further, the parliamentary committee itself noted that one of the organisations involved sent an individual with an unclear identity to represent it as the chief executive, and the ownership of the institutions remains unclear.

For the sake of posterity, therefore, we need to lay out the issues at play, even if the eventual investigations are compromised and come up short.

Firstly, questions were raised about how the private providers were selected. Emerging information that they were the ones involved in the pilot scheme soon after they were registered only serves to solidify the suggestion that they had inside information and were formed solely for the purpose of fleecing NHIF contributors.

Secondly, the procedure of disbursement of money to these institutions raised serious questions. These institutions were paid on the basis of “capitation” which was touted as being in line with “international best practice”. Under this arrangement, the institutions were allocated a number of civil servants and paid in advance for each of them and their families.

A key issue arising from this arrangement is freedom of choice for the civil servants in the selection of facilities. Although the NHIF insisted that civil servants were given the opportunity to select facilities of their choice, many civil servants, including doctors who should know best, discovered that they had been allocated to facilities without being consulted. Those that doubt this assertion need only compare this situation with the registration of political parties, where many Kenyans are complaining that they have been registered as members without their consent.

The capacity of these private providers to administer the scheme was also questioned. Although they advertised their presence countrywide at the beginning of the scheme, many of the advertised facilities turned out to be non-existent, as has now been established by the parliamentary committee. Despite this fraudulent misrepresentation, the providers were given money to provide services at their non-existent facilities. Indeed, a scrutiny of the lists of civil servants allocated to one of the facilities found a number of “ghost” civil servants who had long ago left the service!

Finally, despite all the praise it has received, “capitation” is simply not provided for by the NHIF Act. Unless it was secretly amended, section 22 of the Act provides only for payment against services actually rendered. Under what legal regime was “capitation” even considered?

Dr Lukoye Atwoli is the secretary, Kenya Psychiatric Association, and a lecturer at Moi University’s school of medicine.; twitter @LukoyeAtwoli

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