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Economy

Kagwe in fresh push for higher NHIF deductions

Mutahi Kagwe
Mr Mutahi Kagwe. PHOTO | JEFF ANGOTE | NMG 

Workers will pay higher rates to the National Hospital Insurance Fund (NHIF) if Health Cabinet Secretary nominee, Mutahi Kagwe, has his way.

Mr Kagwe wants all Kenyans compelled to contribute to the NHIF in support of the universal healthcare roll-out, adding that deductions should be made in proportion to income level.

Currently, NHIF contribution is mandatory for formal workers, but voluntary for those in the informal sector and the unemployed.

Informal workers pay Sh500 a month while those in formal employment contribute between Sh500 and Sh1,700 a month to cater for healthcare services at NHIF-accredited facilities.

“There are many Kenyans who cannot afford to pay for NHIF and the most able must be made to support the less able. It is a principle of social democracy,” Mr Kagwe told the committee chaired by Speaker of the National Assembly, Justin Muturi during his vetting.

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"We need to think outside the box. Those earning more should be prepared to pay more towards insurance," the former Minister for Information and Communications told the vetting panel.

The plan echoes spirited campaigns a decade ago when Prof Anyang’ Nyong’o, then Health minister, lobbied MPs for higher NHIF rates only for the proposals to be shot down amid opposition from unions and other groups.

Prof Nyong’o wanted workers earning more than Sh100,000 to contribute Sh2,000 per month while those earning less than Sh6, 000 were to pay Sh150 in what was aimed at subsidising the cost of healthcare.

Kikuyu MP and member of the Health committee, Kimani Ichung’wah said that those earning more than Sh0.5 million should contribute more and increase the pool of funds under NHIF to cater for healthcare.

"Would this include people like me who earn more than Sh0.5 million to contribute more than the Sh1,700 and help cushion those not unable considering that the economy is not doing well?" Mr Ichung’wah posed.

NHIF had 4.3 million members as at end of October last year, according to official data with the low numbers blamed on sluggish economic growth and slow job creation.

The proposal comes a month after 40 State agencies started the search for new insurers in what is set to deny NHIF more than Sh1.9 billion in annual premiums.

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