Kenya health fund faces more court action

August 17, 2010 12:00 am

, NAIROBI, Kenya, Aug 17- Two contributors to the National Hospital Insurance Fund have also now gone to court to challenge the recent increase in monthly NHIF contributions.

Diana Patel and Kiriro wa Ngugi want the High Court to block the Fund from increasing the monthly contributions by more than 500 percent, arguing that the plan is punitive and illegal.

Ms Patel and Mr Ngugi claim the new premiums are irrational and should not to be effected.

"The proposed increments are unreasonably high and illegal unless the President through the Minister of Finance approves any

increase in taxation or contributions to the fund," they said in court documents.

"The NHIF board of management has unlawfully purported to amend legal notices No. 185 of 2003 and 187 of 2003 contrary to the power vested upon it by Parliament under section 46 of the Constitution."

They also accused the Board of usurping the role legally placed on Parliament: "Under sections 48 and 99 of the Constitution, Parliament\’s role in financial matters is to levy taxation, authorise withdrawal of monies from Consolidated Fund and others funds of the Government by the Executive to ensure that proposed expenditure by the Government is lawful, prudent and in the best interest of the public.

"Any increment in taxation requires Parliamentary approval and in any event, the exercise of such drastic powers through subsidiary legislation by unelected board erodes and affronts the essence of democracy.\’\’

"It is in public interest that the new contributions should not be levied until this matter is heard and determined,\’\’ they stated.

The NHIF recently gazetted new contributory rates that moved away from the Sh320 maximum contribution to a progressive rate of up to Sh2,000.

The lowest contributor will now pay Sh150 – which applies to those earning less than Sh6,000 – while the highest contributor will fork out Sh2,000 for those earning more than Sh100,000.

The introduction of the new rates has received opposition from the Central Organisation of Trade Unions (COTU) and the private sector through Kenya Private Sector Alliance (KEPSA) which have already challenged the decision before the Industrial Court arguing that there was no commensurate communication on the benefits that would apply. That case is due before the Industrial court on Friday.

But Medical Services Minister Anyang\’ Nyong\’o has previously defended the move and said the new rates were the only way for the scheme to provide health services to low income earners.

The petitioners contend that the envisaged expansion of the benefit scheme will not be viable adding if contributors are dissatisfied, they have no legal recourse.


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