Kenya, Aug. 6 -- The Social Health Authority (SHA), tasked with advancing Kenya's Universal Health Coverage (UHC), has collected only KES 45 billion in revenue from October 2024 to July 2025, falling significantly short of its KES 54 billion annual target, according to a report by The Standard.

Despite registering over 23 million Kenyans, only 4.4 million are active contributors, yielding a mere 19% contribution density. In stark contrast, the now-defunct National Health Insurance Fund (NHIF) amassed KES 76 billion in the 2022/23 financial year, highlighting SHA's revenue collection challenges amid a transition fraught with legal and operational hurdles.

The SHA revenue collection shortfall of KES 45 billion against a KES 54 billion target underscores systemic issues in Kenya's healthcare financing reform. Launched on October 1, 2024, under the Social Health Insurance Act of 2023, SHA replaced NHIF with a 2.75% gross salary contribution model, aiming to fund three schemes: the Primary Healthcare Fund, Social Health Insurance Fund (SHIF), and Emergency, Chronic, and Critical Illness Fund.

However, with only 4.4 million active contributors out of 23 million registered, the authority struggles to sustain operations. Health policy expert Dr. Brian Lishenga warned in The Standard that the focus on mass registration over sustained contributions has created a "risk-heavy pool" dominated by sick contributors, straining finances.

The KES 54B annual target challenges stem from low contribution rates, particularly among the informal sector, which constitutes 23% of contributors compared to 77% from salaried workers.

The Standard reports that SHA averages KES 4.5 billion monthly, far below the KES 60 billion projected for 2025/26 from salaried Kenyans alone.

The 2.75% contribution rate, with a KES 300 minimum for non-salaried households, has sparked resistance due to economic pressures like 6.7% inflation and a 1.5% housing levy, reducing disposable income.

Legal battles, including a July 2024 High Court ruling declaring the SHI Act unconstitutional for lack of public participation, delayed implementation until a Court of Appeal stay in September 2024, further eroding public trust.

The NHIF vs SHA revenue comparison reveals a stark decline in collections. NHIF, with its tiered contribution system (KES 150-1,700 for salaried, KES 500 flat for non-salaried), collected KES 74 billion in 2021/22, KES 76 billion in 2022/23, and KES 66 billion in 2023/24.

SHA's flat 2.75% rate, while progressive, yields lower returns, with non-salaried contributors averaging KES 591 compared to NHIF's KES 500. Only 22% of NHIF's informal sector members were active, but SHA's 19% contribution density is even lower, raising concerns about sustainability.

The KES 24 billion NHIF legacy debt to hospitals, flagged by the Kenya Healthcare Federation, further complicates SHA's financial landscape.

Informal sector contribution issues are a major barrier to SHA's success. Despite registering 23 million Kenyans, only 4.4 million actively contribute, with 73% of GeoPoll survey respondents living in urban areas and 34% earning below KES 10,000, indicating affordability challenges.

The SHIF's KES 300 minimum monthly contribution for non-salaried households, calculated at 2.75% of annual income, is often unaffordable, with 10% of respondents unclear on SHIF's purpose.

The government's promise to cover indigent households remains vague, and enforcement mechanisms, including 2% penalties for late payments, have deterred participation.

Contributors highlight public frustration over access barriers, such as requiring 12 months of contributions for full benefits.

SHA's healthcare financing reform aims to provide equitable healthcare through enhanced benefits, such as KES 400,000 for cancer treatment (up from NHIF's partial session-based coverage) and KES 952,000 for cardiology surgery, per KUTRRH.

Yet, funding gaps persist, with the government allocating only KES 6.1 billion against a KES 168 billion need, covering just 4% of costs. The Kenya Healthcare Federation's March 2025 meeting with Parliament emphasized addressing NHIF's KES 24 billion debt and improving primary healthcare infrastructure to bolster SHA's rollout.

Government claim of 25 million registrations, reflects optimism, but experts warn that without alternative funding, SHA risks replicating NHIF's failures.

The SHA's struggle to meet its revenue target, coupled with low contribution density, mirrors global challenges in public sector financing.

With only 70,793 formal sector workers contributing KES 5.9 billion in July 2025, per Daily Nation, SHA must address informal sector engagement and public trust to achieve UHC goals.

Collaborative efforts with stakeholders, as planned for April 2025, are critical to resolving these systemic issues and ensuring sustainable healthcare access for all Kenyans.

Published by HT Digital Content Services with permission from Bana Kenya.