The Social Health Authority (SHA) has suspended 45 health facilities across Kenya in the strongest crackdown yet on fraud in the health sector.
The decision, signed by SHA Chief Executive Officer Mercy Mwangangi, took immediate effect through a special Kenya Gazette notice issued on August 26, 2025.
The suspension affects facilities spread across 17 counties. Mandera was the most affected with ten facilities suspended, followed by Kisii with seven, Homa Bay with five, and two each in Kisumu, Bungoma, Kakamega, and Wajir. Nairobi, Garissa, Meru, Kajiado, Narok, Uasin Gishu, Kirinyaga, Migori, Turkana, Busia, and Nandi also had facilities included in the list.
Among those suspended are Aasif Medical and Health Service Limited in Mandera, Equity Afia-Homa Bay in Homa Bay, and Novic Medical Centre in Nairobi. None of the affected facilities will receive reimbursements from SHA during the suspension period. Earlier this month, 40 facilities had already been suspended in the first phase of the crackdown.
Health Cabinet Secretary Aden Duale said the government is determined to root out fraud in the sector, insisting that up to 30 per cent of insurance payouts have been linked to fraudulent claims.
He explained that the billions being siphoned through fake admissions, inflated bills, and ghost patients are funds meant to improve healthcare for ordinary Kenyans.
The scale of the scam has shocked many. Investigations revealed bizarre cases such as hospitals billing for multiple C-sections on the same patient within days, medical officers signing off as both day and night shift staff, and clinics admitting their own employees and claiming reimbursement.
Some facilities converted outpatient visits into inpatient claims, while others filed claims for patients already registered at different hospitals. In Mandera alone, officials uncovered 312 false claims submitted on the same dates for the same patients across different facilities.
Rural and urban private hospital associations have pointed out that the Kenya Medical Practitioners and Dentists Council may have licensed non-existent facilities, making it easy for ghost hospitals to thrive.
Concerns have also been raised over the incomplete migration of financial records from the defunct National Hospital Insurance Fund to the SHA, which may have left loopholes for fraudulent payments to continue.
In March 2025, SHA disbursed Ksh11.4 billion to hospitals, but scrutiny revealed small private facilities had received disproportionately large sums. Civil society groups and doctors warned that some of these hospitals did not exist, while others exaggerated claims.
Health CS Aden Duale later confirmed that investigators had uncovered falsified records, duplicate claims, ghost patients, and inflated bed capacities. In one case, funds were sent to a hospital that turned out to be a thicket.
On August 7, 2025, a Kenya Gazette notice listed 40 hospitals and 12 medics suspended from the scheme after a forensic audit. SHA has denied some reports, including claims Nyandiwa Hospital received Ksh20 million, but public outrage persists.
Oversight bodies have also flagged weak controls. The Auditor General earlier faulted SHA’s digital platform procurement, citing irregular tendering. Civil society groups say the loopholes mirror the NHIF scandal, which a court ruled in May 2025 had suffered years of fraud through ghost patients and inflated claims.
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