Hospitals Suspended for Fraud Reinstated via SHA Portal Bug, RUPHA Claims

Standfirst / Dek

The Rural & Urban Private Hospitals Association (RUPHA) says a system glitch in the Social Health Authority portal has reinstated hospitals previously suspended over fraud and compliance issues. RUPHA demands urgent corrective action to protect patients and preserve trust in Kenya’s universal health scheme.

1) The Latest

• What happened now: Over the last 24 hours, RUPHA officials claim that hospitals suspended for fraud or non-compliance were automatically logged back into the SHA portal because of a technical “system bug”. This reinstatement allegedly restores their access to submit claims and serve patients under SHA. 

• Why it matters: Accepting suspended facilities back without proper vetting risks exposing patients to unsafe services and undermines government efforts to eliminate fraud, which already accounts for a significant portion of health expenditure. 

• Status: Confirmed by RUPHA; SHA response pending. 

2) Context in Brief

• The SHA is replacing the old National Health Insurance Fund (NHIF) as Kenya’s universal health scheme. During transition, many facilities have been suspended or downgraded following forensic audits. 

• Common fraud mechanisms cited include phantom billing, upcoding, and false claims. In August, the Ministry of Health said fraudulent practices could amount to about 15 percent of healthcare spending. 

• Previous challenges: Delays in reimbursement, portal downtime or system glitches, facility compliance failures. RUPHA has frequently raised these issues. 

3) Law, Policy, and Process

• Mandates & Regulation:

  • The Social Health Authority (SHA) regulates which health facilities are accredited and approved to offer services under Kenya’s universal health scheme.

  • Hospitals must satisfy compliance requirements; failing that, SHA has power to suspend access.

• What should happen next per law/process:

  1. SHA should investigate the alleged glitch to confirm its cause and scope.

  2. There should be audit of facilities reinstated to ensure they meet compliance and fraud-free standards.

  3. Possible sanctions or reversals for wrongful reinstatements.

  4. Mechanisms for transparency—public listing of compliant vs suspended facilities, and clear communication to patients.

4) Voices and Stakeholders

• Brian Lishenga, Chairperson RUPHA: Warned reinstatement of suspended hospitals could derail anti-fraud efforts and expose patients to risk. 

• SHA officials: Not yet publicly responded; representative said more time is needed to investigate. 

• Private hospitals / facility managers: Likely concerned about financial, reputational, and legal implications. (Pending interviews)

• Patients / public: Impacted by potential quality lapses, uncertainty over safety, and trust in the health insurance scheme.

5) Evidence & Data Box

6) Risks and Implications

• Patient risk: Reduced quality or oversight could harm patients, especially if facilities under investigation continue providing services.

• Fraud resurgence: Reinstated facilities could resume illicit billing or other non-compliant practices.

• Trust erosion: Public confidence in the SHA and universal health scheme may decline if such glitches persist.

• Financial risk: Unvetted claims could increase losses and strain the health budget.

7) What We Don’t Know Yet

• Which specific facilities were reinstated.

• The technical cause of the system bug and whether it is corrected.

• Whether access reinstatement included claim processing or only eligibility verification.

• What disciplinary or corrective actions SHA plans to take.

• How SHA intends to prevent similar glitches in future.

8) Timeline

• August 9, 2025: Ministry suspends 40 health facilities over fraudulent claims to SHA. 

• Earlier months: RUPHA reports widespread system failures: delays in payments, portal issues, eligibility verification glitches. 

• September 11, 2025: RUPHA alleges that all suspended hospitals regained portal access due to system bug. 

9) What to Watch

• SHA’s public clarification or audit report confirming who was reinstated and why.

• Steps taken to fix system vulnerabilities and ensure compliance.

• Possible reinstatement reversals for facilities that failed audits.

• Legal or regulatory measures to strengthen oversight and patient protection.