The switch from the NHIF to the Social Health Authority (SHA) in Kenya has generated a great deal of controversy as well as optimism.

Although many private hospitals are acceptable partners, recent government investigations and forensic audits under the cabinet secretary for Health, Aden Duale, have revealed several sophisticated “tricks” used by rogue facilities to embezzle billions from the fund.

Duale revealed how private hospitals have devised elaborate schemes to defraud the Social Health Authority (SHA) by siphoning billions of shillings meant for patient care.

Here are the common ways private hospitals have been found or alleged to “steal” from the SHA:

Also Read: SHA Appoints 82 New Principal Officers

“Upcoding” Procedures

This is the most frequent trick where a hospital performs a simple, low-cost procedure but bills the SHA for a more complex, expensive one. For example, a minor wound dressing might be billed as “major surgical debridement,” or a normal delivery is billed as a Caesarean Section (C-Section) to claim a higher tariff.

The hospitals claim for more expensive than those performed.

Falsification of Records

Another widespread method is the falsification of records, in which hospitals submit altered or false medical documents to secure higher reimbursements.

The ministry said the hospitals submit altered medical information to inflate claims.

A number of hospitals mostly report cases where a single person “signed off” as both the day and night shift doctor for weeks on end—a human impossibility used to create a paper trail for fake admissions.

Also Read: Duale Reveals Which Kenyan Health Data Will Be Shared with the U.S. and Why

Conversion of Outpatient to Inpatient

Visits have also been converted into inpatient claims by hospitals. In order to inflate reimbursements and further deplete public resources, routine visits are billed as full hospital admissions.
This simply means billing for services patients deny receiving.
This is typically done in order to get a larger reimbursement from government programs and insurance companies.

Phantom Billing

The most serious scheme is phantom billing, where hospitals claim payments for services, procedures, or medical equipment that were never provided. Unlike upcoding, which exaggerates actual services, phantom billing invents them entirely.

The ministry said some hospitals collude with other facilities to claim the same patient.

The CS, while speaking in August 2025, highlighted some facilities implicated that include hospitals in Nairobi, Bungoma, Homa Bay, Mandera, Kilifi, and other counties.

The Ministry said it withdrew SHA platform access rights from eight doctors and four clinical officers linked to the fraud, and forwarded their names to the Directorate of Criminal Investigations (DCI) for prosecution.

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A picture of SHA Office in Nairobi
Photo/SHA Website