Doctors hit patients with cash bills on eTIMS row


Payments outside the system mean such transactions will escape the radar of the KRA, making it difficult for the taxman to get a fair share of taxes from doctors’ fees.

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Doctors are forcing patients to pay medical bills in cash on continued snub of the Kenya Revenue Authority’s electronic invoicing portal, exposing millions of insured customers to out-of-pocket spending despite Sh5.5 billion monthly spending on health covers.

Medical insurers who spoke to the Business Daily said some doctors are asking patients to pay in cash and then seek reimbursements from their insurers.

Patients are, however, incurring losses given the law that requires all individuals and entities involved in business to electronically generate and transmit invoices through KRA’s electronic tax invoice management system (eTIMS).

The KRA in April 2024 rolled out eTIMS making the electronic tax invoices compulsory to allow it to know the amount of tax to expect from individuals and entities in business.

Many doctors operating private clinics have, however, snubbed the platform citing among other reasons, data privacy for their patients and a mismatch between invoices raised and the actual payment received for medical services rendered.

Medical insurance is the largest class of general insurance. Customers paid insurers Sh66.3 billion for covers in the financial year ended December 2023 or Sh5.5 billion monthly while insurers paid out claims worth Sh37.11 billion, in what marked a 17.6 percent rise from the previous year.

Payments outside the system mean such transactions will escape the radar of the KRA, making it difficult for the taxman to get a fair share of taxes from doctors’ fees.

Doctors in March, through their union, Kenya Medical Association, filed a case seeking exemption from eTIMS but failed to secure a stay order. The court directed that they await a judgment on July 6.

However, KMA president Simon Kigondu has been rallying doctors to snub the system even before the outcome of the case, condemning customers to out-of-pocket payments.

“I’d advise doctors not to use eTIMS for invoicing patients until the case is determined. It is unfortunate that the judge did not give a stay order because doctors continue to get harassed by insurance companies to provide eTIMS-compliant invoices yet they have raised a case against its confidentiality,” said Mr Kigondu in one of the several posts on his social media platforms.

“Because many clients cannot access their doctors, they are forced to go to hospitals or have to pay cash and try to claim. This is a denial of service.”

Insurers, wary of a possible backslash between them and their customers due to the doctors’ position, are reaching out to customers, informing them of the difficulties in reimbursing expenses that have not passed through the eTIMS portal.

“If you go to a doctor and they don’t have eTIMS, they ask for cash payment and when patients seek reimbursement, it is difficult for us to do so. So, the person taking the hit is the insured customer because many are only discovering this at the point of seeking the reimbursement,” said the chief executive of one of the top medical insurers in the country.

“We have written to our customers informing them that eTIMS is the law and we have to comply. Many of the insured have not realised the implication of making cash payments on transactions that have not been fed into eTIMS.”

Letters seen by the Business Daily show that many insurers including Jubilee Health, Old Mutual, Heritage, AAR Health and Kenya Alliance, all wrote to medical service providers, including doctors running private clinics, informing them they would not accept invoices that have not been generated through eTIMS.

Jubilee Health commanded a market share of 17.81 percent in medical insurance as at the end of December 2023 followed by Old Mutual General (16.02 percent), AAR Insurance (14.11 percent), APA Insurance (11.45 percent) and CIC General (11.05 percent), making them the top five medical insurers in the country.

Old Mutual said it had sent out a communication to hospitals, clinics, doctors and customers, informing them of what was expected of them ahead of the full switch to eTIMS on April 1 this year, but some doctors have shown reluctance.

“It has been a challenge but gradually we are seeing more doctors take this up. We have made it clear to our clients and business partners including brokers that if a claim is raised, then the expectation is that it must run through eTIMS,” said Elijah Matolo, medical practice manager at Old Mutual.

“We asked our providers to confirm either that they have complied or sent a commitment letter that they will comply to ensure claims are received and payments released within the usual credit period. We have had challenges with some doctors who had concerns with eTIMS.”

The KRA data released in May showed 236,000 businesses onboarded on the eTIMS, just about 49 percent, were reporting transactions with other businesses, posing a challenge for the taxman that is targeting at least 679,000 businesses that were not paying taxes.

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Note: The results are not exact but very close to the actual.