Kenya is changing the way health facilities contract with the Social Health Authority (SHA), with the new rules tying reimbursement to the specific services that a facility is licensed to provide.
These changes form part of the 2026-2029 contracting cycle, which coincides with the expiration of the current contracts on October 14, 2026.
However, the changes come amid concerns from healthcare providers regarding contracting requirements, claims processing, tariffs, pre-authorisation and delayed reimbursements.
What exactly will change under the new SHA contracting rules?
The 2026-2029 SHA contracting cycle will introduce changes to the way health facilities participate in the public health insurance system.
Facilities will only be contracted to provide services for which they hold the necessary licences and regulatory approvals. The new process will also use a digital contracting platform.
The new framework introduces a 90-day timeline for paying clean claims, a digital contracting platform, and a conditional compliance period for facilities that have met most requirements but are still obtaining some statutory documents.
The new arrangements also provide a conditional compliance period for facilities that have met the other contracting requirements but are still obtaining specified statutory documents.
Does the 90-day payment rule mean that hospitals will receive their SHA funding within three months?
The 90-day requirement applies to clean claims and does not guarantee that every claim submitted to the SHA will be paid within three months.
A clean claim is one that meets the requirements and has no outstanding issues requiring clarification or correction. Under the new framework, clean claims will be processed in the order they are received and paid within 90 days.
If insufficient funds are available to settle a clean claim within this timeframe, the unpaid amount will be recognised as a certified liability and carried forward for settlement within the same financial year, provided the necessary funds are available.
Why is the SHA making individual service licences part of the contracting process?
This new requirement means that the SHA will link a facility’s contract to the specific services that it is legally authorised to provide. While a facility may be licensed to operate as a health facility, it may still require separate regulatory approval for particular services. For example, laboratories, pharmacies and imaging services are subject to regulation by their respective statutory bodies.
This requirement is therefore intended to ensure that facilities are contracted for, and reimbursed for, services that fall within their approved regulatory scope.
‘The national and county governments reaffirmed their commitment to ensuring that eligible public health facilities complete the contracting process on time and continue to provide quality, accessible, uninterrupted services to SHA beneficiaries,’ said Aden Duale, Health Cabinet Secretary.
What happens if a hospital has a SHA contract but lacks a licence for one of its services?
The hospital does not necessarily lose its entire SHA contract. It can be contracted for services for which it meets the required regulatory conditions.
Therefore, the facility would remain contracted for its compliant services, but would not be able to claim SHA reimbursement for services it is not authorised to provide.
‘Facilities will only be contracted for services for which they are duly licensed,’ said Mr Duale.
What other issues are providers concerned about under the new contracts?
Several aspects of the SHA’s contracting and reimbursement system have been raised as concerns by providers, including tariffs, claims processing, pre-authorisation, empanelment, payment delays, and the digital systems used to manage services and claims. These issues impact the conditions under which facilities provide care to SHA beneficiaries and seek reimbursement from the Authority.
Could the new contracting requirements affect patients?
They could affect where patients obtain particular services. If a facility is not contracted to provide a particular service because it lacks the necessary regulatory approval, SHA beneficiaries may have to obtain that service from another contracted facility.
What will happen to facilities that have not completed the new contracting requirements by October 14?
Current SHA facility contracts have been extended to October 14, and the government has confirmed that they will not be extended again.
This means that facilities must complete the new contracting requirements within the transition period. If a facility has not met the requirements by the end of the current contracting period, its existing contract will not be extended simply because it has not completed the new requirements.
However, facilities that have met the other contracting requirements but are still awaiting specified statutory documents have been granted a conditional compliance period of 30 days to submit these documents.
These documents are required from the National Social Security Fund, the National Environment Management Authority, the fire safety authorities, the National Council for Persons with Disabilities and the Office of the Data Protection Commissioner.