How officials c*****ed with hospitals to s***l from NHIF

A fresh probe has unearthed systemic loopholes that aided the siphoning of billions of public funds from the National Health Insurance Fund (NHIF).

A report, by the Ethics and Anti-Corruption Commission exposes loopholes and avenues that were used to steal the billions from the insurer.

In the two-month survey conducted between August 31 to November 2, 2023, it was established that there were numerous infiltration of the digital claims system by third parties, through which funds were pilfered.

While reviewing system audit logs, the investigations revealed that numerous third-party unauthorized access to enterprise systems led to the addition of unauthorized services to Health Care Providers (HCPs).
Without giving comprehensive figures of the funds that were stolen, the investigation sampled NHIF regional and branch offices in Nakuru, Embu and Mombasa where 12 specialised services were added to one HCP.

“Privileged transactions were carried out by unauthorized users in the E-Claims system,” Dr David Oginde, the EACC chairperson said when he released the report yesterday.

And this happened with the knowledge of some NHIF staff who colluded with managers in the various health care providers involved.

The investigation picked glaring anomalies where an amendment to members’ and health care providers data and processing of transactions without approval workflows, was picked.

“Three staff irregularly amended member details occasioning a loss of Sh29,958,642 to the Fund,” said Oginde who was flanked by Medical Services Principal secretary Harry Kimtai, Social Health Authority chairman Timothy Olweny and Chief Executive Officer Elijah Wachira as well as NHIF Board Chair Eng Michael Kamau.

The report also found out that assignment and withdrawal of ‘First In, First Out- FIFO’ override rights, adding and removing of service codes to HCP facilities, aiding disappearance of funds.

“There was also arbitrary assignment of FIFO override rights, enabling unauthorised personnel to process claims without the FIFO principle,” added Dr Oginde, pointing out that the review noted that failure to promptly migrate users’ system profiles for transferred staff, also aided theft.

The audit revealed the sharing of system access credentials between staff and interns, unauthorised access and abuse of user access rights and fraudulent use of inactive user accounts to aid the plunder of the scheme’s coffers.

It also established that favouritism and opportunities for bribery and extortion in claims processing, including lack of accountability and compromised data integrity which provided avenues through which money was lost.

“Loss of funds through collusion and fraud is a key ingredient that occasioned theft of contributors’ money,” the report shows.

The review, which aimed at identifying weaknesses, opportunities and loopholes for corrupt practices, also found out that timelines for HCP empanelment process including contracting for various packages, were not defined.

The commission also examined the systems, policies, procedures and work practices at the NHIF re-contracting process, which it found to be costly and laborious.

“In such circumstances, shortcuts are common, and therefore bribery comes into play,” Dr Oginde said.
Some public HCPs were not assessed for re-contracting, for example at the Runyenjes Level 4 Hospital in Embu County.

Others were found to have operated without valid documents due to delays in processing contracts as was witnessed at the Nakuru and Embu Level 5 hospitals.

“Mechanism for tracking status of contracts had not been instituted, for example in Kenyatta University Teaching and Referral Hospital, where the cyber knife for cancer patients took a lot of time to include in the contract,” the survey revealed.

Contractual requirement for establishment of Quality Improvement Teams and quarterly reporting to the Fund by HCPs was not enforced in all the health facilities sampled, it further noted.

The findings of the systems review at the NHIF included identified weaknesses that may lead to corrupt practices in five key areas namely Legal and Policy Environment; Information Communication and Technology, Beneficiary and Provider Management, Sponsored Schemes and Support Services.

The Fund failed to adhere to referral guidelines in the management of benefits, the survey established.
It also revealed a weak framework for corruption prevention at the Fund as well as lack of business intelligence tools for proactive decision-making.

There was also failure on the part of the fund to initiate an independent legal and compliance audit; Costing of benefit packages not informed by evidence and actual costing of procedures.

The report gave a wide range of recommendations which included development and implementation of referral mechanism as envisaged in the Kenya Health Sector Referral Implementation Guidelines, 2014.
It also proposed that the fund mainstreams corruption prevention while facilitating provision of business intelligence tools for enhanced decision making.

It also recommended a review of the benefit packages based on evidence and costing of procedures.
Kimtai called on health facilities across the country to digitise their systems warning that no facility will be authorised to provide services under the Social Health Authority (SHA) without such a system.

“We have already started that journey with the registration of all Kenyans into one system, so that they can access services wherever they are in SHA empanelled facilities,” the PS said.

Olweny said no NHIF employee who has been blacklisted will transition to the SHA, until they are cleared of the allegations of fraud.

Some claims were returned to the HCPs without clear reasons and direction on action required on the part of HCPs.

For example, at HCP code 00191972, 153 claims were rejected without explanation between 2019 and 2023, while at HCP Code 2224257, claims worth Sh4 million were rejected between December 7, 2021 and July, 2023, and at HCP Code 2224256, claims worth Sh846,220, were rejected between August 27, 2021 and November 5, 2021.

There were also delays of up to a year in processing of claims logged by HCPs.
The investigations were carried out at the Nakuru Level 5 Teaching and Referral Hospital, Metropolitan Level 5 Hospital, Buruburu, Coast General Teaching and Referral Hospital, Embu Level 5 Teaching and Referral Hospital, Valley Level 4 Hospital, Nakuru  and ACEF Ena Health Care, Embu.

Others were; Mbagathi Level 4 Hospital, Runyenjes Level 4 Hospital, Tudor Level 4 Hospital in Mombasa, and Bahati Level 4 Hospital, Nakuru.

The report comes ahead of the planned roll-out of the Social Health Insurance Fund (SHIF) to replace NHIF which has been dogged by corruption and fraud allegations.