How Rogue Hospitals Siphoned Sh11 Billion From SHA in Massive Healthcare Heist

NAIROBI, Kenya – Kenya’s healthcare system has been rocked by revelations of a staggering Sh11 billion fraud orchestrated by rogue private hospitals and health facilities in just six months, exposing the darkest side of the country’s flagship universal health coverage programme.

In a shocking exposé, Health Cabinet Secretary Aden Duale has lifted the lid on what he describes as “real theft” that nearly crippled the Social Health Authority between October 2024 and April 2025, with private hospitals leading the criminal enterprise that has left the government reeling.

The scale of the fraud is breathtaking. Hospitals converted simple outpatient visits into fake inpatient admissions, billed for surgeries that were never performed, and in the most audacious cases, healthcare workers registered themselves as patients to steal from the system meant to serve millions of vulnerable Kenyans.

“This is when the real theft took place. The situation was shocking,” Duale revealed during an exclusive interview, pulling back the curtain on why the Health Ministry earned its notorious nickname, Mafia House.

The Anatomy of Healthcare Robbery

The fraud scheme reads like a crime thriller. Desperate Kenyans who walked into hospitals for minor ailments found themselves mysteriously admitted overnight, not because their conditions warranted it, but because greedy facility owners saw an opportunity to inflate their claims and pocket taxpayer money.

In a particularly brazen twist, some maternity hospitals claimed that every single delivery they handled was a caesarean section, a medical impossibility that defies World Health Organisation standards and common sense. The CS did not mince his words when describing these claims as outright fraud.

Private facilities, which have historically profited handsomely from the now-defunct National Health Insurance Fund, emerged as the primary culprits in this grand theft. Faith-based hospitals, by contrast, recorded the lowest rejection rates, suggesting a moral compass that their private counterparts appear to have lost in their pursuit of profit.

Ghost Patients and Phantom Surgeries

The fraud went deeper. Surgical claims became a lucrative avenue for theft, with missing theatre notes and incomplete documentation making it impossible to verify whether procedures were ever performed. Hospital owners had the audacity to complain about SHA’s high rejection rates for surgeries, even as investigators uncovered evidence of systematic billing fraud.

In some facilities, the betrayal was internal. Healthcare workers who had taken oaths to heal instead turned into thieves, registering themselves as patients and logging false claims into the system. These facilities have since been shut down, but the damage was done.

Government Fights Back

Duale has declared war on the fraudsters. Last year alone, he presented 118 files to the Directorate of Criminal Investigations. Twenty-four files have been completed, with 15 forwarded to the Director of Public Prosecutions just last week. Court cases are already underway, including some involving senior SHA staff.

More than 18 doctors and 22 clinicians have been permanently banned from the SHA portal, their careers in the public health system effectively over. The message is clear: those who steal from sick Kenyans will face the full force of the law.

In October last year, DPP Renson Ingonga approved charges against 10 suspects, including four directors of health facilities in Kilifi and Vihiga counties. Two facilities, Jambo Jipya Medical Clinic and St Mark Orthodox Hospital, allegedly colluded with a SHA employee in a criminal conspiracy to defraud the system. Jambo Jipya alone submitted Sh2 million in fraudulent claims.

The Road to Recovery

Despite the massive losses, the government has poured Sh75 billion into the Social Health Insurance Fund over the last 14 months, alongside Sh4 billion to the Public Officers Medical Scheme and Sh1 billion to the Emergency, Chronic and Critical Fund. The healthcare system runs on government money, and Duale wants facilities to deliver what Kenyans have paid for.

Some hospitals with smaller debts have signed consent agreements and are negotiating repayment terms. Those willing to disclose what they stole and commit to paying it back will be given a chance, but the CS has warned that no one involved in fraud will be spared.

Digital safeguards and investigative mechanisms have now been deployed. The daily claims and revenue are balanced, and the system automatically notifies facilities when claims are rejected, explaining what documentation is required. The era of easy theft, Duale insists, is over.

A Vision for the Future

Looking beyond the scandal, the CS has set an ambitious vision for Kenyan healthcare. He wants the country to become the leading nation in healthcare delivery in Africa, where even presidents can be treated in the same facilities as ordinary citizens.

It is a bold dream, but one that can only be realised if the thieves in white coats are completely weeded out and the system rebuilt on a foundation of integrity. For now, the government is focused on one thing: recovering every shilling stolen from sick Kenyans who deserved better than to be robbed by those who swore to heal them.

The Sh11 billion heist has exposed the rot in Kenya’s healthcare system. Whether the government can successfully recover the stolen funds and restore public trust remains to be seen. What is certain is that the days of unchecked fraud are numbered, and those who participated in this grand theft should be looking over their shoulders.​​​​​​​​​​​​​​​​