The board of the troubled national health insurer planned to disburse an additional Sh700 million to hospitals and clinics weeks before a major split emerged among its members, the Sunday Nation has established.

Under the plan, the National Hospital Insurance Fund (NHIF) was to send the money to all the facilities that benefited from a similar allocation during round one in the first quarter of the year.

Some of the medical providers turned out either to have been ghost clinics or to be grossly ill-equipped to effectively attend to patients under the civil servants’ scheme.

Interviews with board members and people familiar with the Sh4.2 billion medical scheme for civil servants revealed that some officials of the NHIF board wanted investigations conducted into the first round of Sh700 million disbursements.

Based on the findings of the investigations, ghost clinics would be identified and excluded from the second round of allocations.

But other officials wanted the disbursements, already delayed since April, to be effected since they were part of a contract already negotiated between the NHIF and individual organisations.

The disagreement reached a climax on Thursday when board chairman Richard Muga, one of those who opposed the second round of disbursements before investigations, suspended chief executive officer Richard Kerich to allow investigations to get under way. (READ: Inside NHIF battle to control billions)

But other board members led by vice-chairman Wilson Sossion immediately disowned the move and sought the support of the Medical Services ministry. Minister Anyang’ Nyong’o suspended Prof Muga.

The exchange that played out before media cameras prompted the Head of Public Service Francis Kimemia to suspend the entire board on Friday. In a statement, Mr Kimemia said Mr Kerich would also be suspended.

“This will pave the way for the appointment of a caretaker management board and conducting of investigations into the alleged malpractices in the institution,” he said. “Additional measures will be announced next week.”
Prof Muga welcomed the government’s move, arguing that investigations will help uncover questionable dealings in the scheme in order to save it from collapse.

“This is a good scheme, and we must guard against mismanaging it,” he said. Underlying the differences is what appears to be an haphazard manner of disbursing the money.

The fund had approved the capitation method by which each of the facilities identified is given specific amounts of money according to the number of civil servants who selected it as their health service provider.

Prof Muga confirmed there had been weaknesses in the first round of disbursements. “When many mission, private and public facilities were left out, the board protested to the management, but they were ignored.”

“Now management wanted to pay the second quarter on the same basis, and that is what the chair and the board were trying to avoid to address the challenge,” he added.

He claimed that Mr Kerich often divided the board and created a parallel unit in his office to implement the new scheme against the board’s wishes, and this circumvented the fund’s procedures.

But suspended vice-chairman Sossion said the pending Sh700 million had to be paid as it was part of a contract signed between the fund and health providers.

“There is no way anyone can turn around and fail to honour the contract,” he said. Mr Sossion, the chairman of the Kenya National Union of Teachers, said some teachers had already sought treatment in selected facilities to the tune of Sh40 million even before NHIF disbursed the funds.

source: http://www.nation.co.ke/News/NHIF+wanted+to+pay+additional+Sh700m+/-/1056/1400308/-/15qjddnz/-/index.html

The basic pay for the lowest paid workers in the country was on Tuesday raised by Sh1,021 to Sh8,821 per month. The announcement for the 13 per cent pay raise was contained in President Kibaki’s speech to workers read by Vice President Kalonzo Musyoka during Labour Day celebrations at Nairobi’s Uhuru Park. It raises the minimum pay from Sh7, 800, a month to Sh8, 821 per month. “The government will increase the basic pay by 13.1 per cent,” the President told workers of the country. This, he said, was only a part of a larger plan of the government to make working in the country a comfortable experience for all Kenyans irrespective of the industry where one worked. But the news of the salary increment was received with mixed reactions from the crowd that had turned up. Food prices “I’m happy with the announcement, but they also need to look at food prices and basic products as well. The Sh5,000 today is so little one cannot sustain themselves,” said Ms Sarah Shabaan, a domestic worker. “Prices of flour have gone up, yet the income remains the same for some or even lower. We need to see the government ensuring that every Kenyan lives a comfortable life,” said Ms Zainab Nuru. “Kenyans should be sober enough to elect leaders who are trustworthy, responsible and can relate with the challenges of a common Kenyan,” said Mr Ibrahim Shisia, who works with the Print Point. He also noted that with the prices going up it becomes difficult for people to develop since all the money is spent on food, rent, clothing and education leaving literary nothing for saving. “This in return leaves very miserable non-developing Kenyans,” he added. But Mr Musyoka cautioned workers against dishonest recruitment agencies, especially those with bases in the Middle East that had brought untold suffering to desperate job-seekers. He urged them to seek information from the ministries of Foreign Affairs and Labour on authenticity of the jobs.