SHA extends deadlines, as fewer hospitals sign new contracts

The Social Health Authority (SHA) has extended the deadline for contracting hospitals to the new contracting cycle.

The deadline has been extended to October 14, from its initial date of October 1, 2026.

The contracts dubbed HAKIKA cover the 2026/29 contracting cycle, through e-contracting.

“SHA has extended he contracting deadline by 14 days, to October 14, 2026 to give healthcare facilities more time to complete contracting for the 2026/29 cycle,” reads a section of the notice.

In a statement by SHA Chief Executive Officer (CEO) Dr Mercy Mwangangi, during the extension period, facilities will continue operating under their existing contracts.

So far, only 10,006 providers have expressed interest and are at various stages of the contracting process.

Dr Mwangangi said that at the end of the 14 days, the existing contracts will lapse and no further extension will be granted.

“Providers shall be issued with an extension to the healthcare provider contract ending September 30, 2026 to cover the 14-day extension period accessed through the e-contracting platform,” added Dr Mwangangi.

“Providers are required to confirm acceptance, sign, and return the agreement within three days to assure continuity of services to SHA beneficiaries,” added the CEO.

To support providers in completing the contracting process for the 2026/29 contracting cycle, SHA will conduct dedicated HAKIKA contracting clinics in every county, from Monday next week, through the respective SHA county offices.

Insiders said SHA was forced to extend to meet expected numbers.

“They need about 14,000 applications. 23,000 hospitals are eligible to contract,” said an insider.

So far, the source said only 10,000 hospitals have completed the process.

“Fewer than 10,000 have completed the extremely stringent and excessive contracting process,” added the source.

Some hospitals, he said, cannot onboard the contracting cycle because the requirements are too high.

The contracting cycle is purely a legal document, which requires doctors to seek legal counsel and lawyers before signing the 150-page contract.

Hospitals, according to the source

Earlier, the deadline had been set for September 17, 2026, which would be postponed to October 1, following outcry from hospitals over disputed clauses in the new contract.

Hospitals through their consortium, including Christians Health Association (CHAK), SUPKEM, Kenya Association of Private Hospitals (KAPH) and Rural Urban Private Hospitals Association of Kenya (RUPHA), had requested more time to review the contract.

The associations, which represent more than 3,000 facilities across the 47 counties.

The consortium has listed about 40 items in the submission set to be presented to SHA leadership during the engagement.

SHA had made the obligation subject to the availability of resources in the relevant Fund and appropriation of Funds by the National Assembly.

Even with the obligation, hospitals warned against charging patients.

The contract applies to the Primary Health Care Fund (PHCF), Social Health Insurance Fund (SHIF), Emergency, Chronic and Critical Illness Fund (ECCIF) and Public Officers Medical Scheme Fund (POMSF).

Hospitals also questioned why SHA dictates payment, yet the majority of patients treated are required to register and pay 2.75 per cent for salaried workers to enjoy SHIF services.

SHIF is funded by individual contributions, capped at 2.75 per cent of income for salaried people, with means testing for those in the informal sector.

The Fund is also financed through money appropriated by the National Assembly for indigent and vulnerable persons, as well as gifts, grants, innovative financing mechanisms and donations.

Two funds, the PHCF and ECCIF, are funded by the exchequer, from taxpayers' money.

In the submission, the consortium wanted SHA to allow them to charge patients for services issued when money is not available, or have SHA services suspended, to prevent them from running into losses that have been experienced in the past.

The hospitals also strongly challenged claims auditing provision, which they say could result in deductions being applied beyond individual claims found to have errors.

The hospitals' concern was that where a sample of claims shows errors, SHA can extrapolate the error rate to a wider batch and deduct the corresponding amount.

“That is illegal, definitely. You can't approximate accounting. Accounting is exact. You cannot say you are going to estimate a penalty, or a surcharge; it is not proper. No one does that ever,” said sources.

According to hospitals, if SHA is set to surcharge a facility, they need to have evidence with a basis, and not an approximation.

With the clause in the contract, SHA assumes that hospitals will always have errors in their operations, therefore imposing deductions.

But hospitals have maintained that the deductions are illegal and are not listed in the Social Health Insurance Act 2023, nor in the SHA General Regulation tied to SHA hospitals contracting.

The hospitals had also proposed contracts introducing “materially revised terms, obligations and risk allocations” across the four funds, requiring providers to undertake a detailed review before signing.

“Our member facilities, close to 85 per cent of them small and medium-sized providers with limited in-house legal capacity, require adequate time to review these documents clause by clause, consult their boards and governing bodies, and, where necessary, obtain independent legal guidance on their interpretation before they can responsibly submit comments or commit their facilities to sign,” the associations said in a statement.

“A hurried review risks generating comments of lower quality, or facility-level decisions taken without a full understanding of the obligations assumed, with resultant defaulting on the contractual obligations,” they added.

They said this would not serve the interests of either SHA or healthcare providers.

Notably, the associations said they supported Universal Health Coverage (UHC) and the Social Health Insurance Act, 2023, and recognised SHA's responsibility to safeguard public health funds and protect the integrity of the scheme.

They also acknowledged SHA's audit of claims, saying they understood that the proposed contracts had been drafted more strictly, at least partly in response to the findings.

“We recognise the Authority's duty to safeguard the Funds and to protect the integrity of the scheme on behalf of all Kenyans,” they said.

However, they said providers needed sufficient time to understand the new obligations before committing themselves to the contracts.

“It is not our intention to delay implementation, but to ensure that when our members sign, they do so with full understanding of, and confidence in, the terms they are accepting,” added the associations.

They argued that adequate review would strengthen compliance and reduce disputes during the life of the contracts.

mkahenda@standardmedia.co.ke