Private hospitals issue 14-days go-slow notice over Sh76billion unpaid SHA debt
Private hospitals across the country have issued a fourteen days’ ultimatum to the government to settle outstanding Sh76billion debt or face a complete healthcare system paralysis.
The stark notice was delivered by the Rural Private Hospitals Association of Kenya (RUPHA) yesterday to the Social Health Authority (SHA) headed by CEO Dr. Mercy Mwangangi saying the notice takes force effective September 5, 2025.
Speaking in Nairobi yesterday, RUPHA chairperson Brian Lishega said hospitals across the country are in a crisis, with the government owing them Sh76billion.
He warned that the debt is crippling the healthcare system, leaving facilities without medicines, staff, and operating cash flow.
Lishega added that hospitals across the country are on the brink of collapse unless urgent measures are taken to address mounting debts, rejected claims, and arbitrary facility suspensions.
“Kenyan hospitals remain in severe financial distress due to delayed and inadequate reimbursements by the Social Health Authority. This is the lived reality of hospitals, not the narrative of ‘timely payments’ presented to the public,” he said.
According to Lishega, 50 per cent of claims from Level 2 to Level 4 hospitals remain unpaid, pushing many institutions into financial distress.
As of the end of August 2025, healthcare providers had submitted claims worth Sh.96.2billion, but only Sh53billion has been paid, leaving an outstanding obligation of Ksh.43 billion.
The association noted that 50 percent of claims from lower-level facilities also remain unpaid, with general inpatient and surgical claims recording payout ratios as low as 10 to 20 percent.
The RUPHA boss also raised concerns about the sustainability of SHA’s financing model, saying the authority collects about Sh5.4billion monthly but faces claims worth Ksh.8.7 billion, creating a deficit of up to Sh3.5billion every month.
He faulted the design of schemes such as Proxy Means Testing and Lipa SHA Pole Pole, which it said had failed to increase informal sector contributions, while lump-sum premium payments remained unrealistic for households.
On liabilities, Lishega accused the government of ignoring a Presidential Directive issued on March 5, 2025, to settle National Health Insurance Fund (NHIF) debts below Sh10million.
NHIF liabilities stand at Sh33billion, while SHA owes Sh43billion, pushing the total debt owed to hospitals to Sh76billion.
The biggest unpaid balances are owed to public and mission hospitals, including Kenyatta National Hospital (Sh1.58billion), Moi Teaching and Referral Hospital (Sh1.23billion), Kenyatta University Teaching, Referral and Research Hospital (Ksh.540 million), and Nakuru County Hospital (Sh297million).
RUPHA further protested the mass rejection of valid claims, noting that facilities are being denied payments months after submission without due process.
“Today, claims are being rejected months after submission, without due process, denying hospitals rightful payments,” Lishega added.
He also accused SHA of arbitrarily deleting bed capacities, downgrading, and suspending facilities, actions it said contravene the Fair Administrative Action Act and the Constitution.
To avert a crisis, RUPHA is demanding five key actions within two weeks: immediate settlement of NHIF liabilities in line with the presidential directive; payment of at least 50 per cent of the Sh43billion SHA backlog; activation of a claims clarification mechanism on the SHA portal; formation of a Dispute Resolution Tribunal to oversee suspensions and downgrades; and transparent publication of claims data.
“Without action, access to healthcare will collapse under the weight of debt. A Marshall Plan is urgently required to clear debts and redesign SHA sustainably,” Lishega warned.
