The long-anticipated Social Health Insurance Act, 2023, which replaces the National Hospital Insurance Fund (NHIF) and establishes three new funds, officially came into effect on Wednesday marking a significant milestone in the realm of healthcare financing in Kenya.

Health Cabinet Secretary Susan Nakhumicha announced the groundbreaking development in a gazette notice, setting the stage for a comprehensive reform aimed at addressing the persistent challenges that plagued the now-defunct NHIF.

"IN EXERCISE of the powers conferred by section 1 of the Social Health Insurance Act, 2023, the Cabinet Secretary for Health designates the 22nd November, 2023, as the date on which the Social Health Insurance Act, 2023, shall come into operation," the gazette notice read.

Under the new framework, three distinct funds will be operational: the Primary Healthcare Fund, the Social Health Insurance Fund, and the Chronic Illness and Emergency Fund. These funds are envisioned to streamline and enhance the efficiency of healthcare financing and provision across the country.

The Social Health Authority (SHA) is set to replace the National Health Insurance Fund, aligning with the provisions of the Social Health Insurance Act, 2023.

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Notably, the act introduces stringent measures to ensure compliance, with individuals eligible for registration required to provide proof of compliance to access public services.

The act explicitly states, "Any person who is registerable as a member under this Act shall produce proof of compliance with the provisions of this Act on registration and contribution as a precondition of dealing with or accessing public services from the national government, county government or national or county government entities."

Moreover, the Social Health Insurance Act extends its coverage to non-Kenyan residents, allowing them eligibility for registration as members of the Fund.

This includes non-Kenyans residing in the country for a period exceeding 12 months. However, those planning to stay for less than 12 months must possess travel health insurance coverage.

To address concerns of corruption and fraud within the health insurance scheme, the act introduces stringent punitive measures. Individuals suspected of defrauding the system through false statements risk imprisonment for up to five years or a fine of Sh1 million, or both.

In a move to facilitate a seamless transition, the defunct NHIF is mandated to transfer all its cash balances to the newly established Social Health Insurance Fund.

The commencement of the Social Health Insurance Act, 2023, was officially declared by Cabinet Secretary for Health Susan Nakhumicha in a notice dated the 21st of November, 2023.

The act is poised to usher in a new era of healthcare financing and delivery, addressing longstanding issues and paving the way for a more inclusive and accountable healthcare system in Kenya.