Gakuya accuses doctors of fueling SHA scandal
Embakasi North Member of Parliament James Gakuya has called out public hospital doctors, accusing them of fueling the Social Health Authority (SHA) scandal by using their positions to benefit their private hospitals.
The Embakasi North lawmaker noted that the practice has evolved into a cartel, exploiting patients and draining public health resources, which he links to the ongoing defrauding SHA scandal.
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James Gakuya made his remarks on Tuesday, August 26, 2025, during an interview with a local media house, while further revealing that most of the doctors have their own private hospitals and directly refer clients there.
“Most of the doctors have their own private hospitals, and they directly take clients to their hospital. Most of the time, you realise that the doctors allege for a cartel that there is no medicine in government facilities, hence directing clients to their own hospital,” Gakuya said.
While terming it a big scandal, the legislator also hinted at several SHA senior staff’s own private hospitals, which have been an avenue for siphoning healthcare funds.
“It is a big scandal, and most of the senior staff within this particular SHA scandal may have their own private hospitals,” Gakuya said.
Calls for probe
Likewise, Gakuya called for a thorough investigation into relationships between SHA-linked private hospitals and senior Ministry of Health staff.
“I think it is far wiser for due diligence to be done to know those who are very close to senior staff or if senior staff are involved with such private hospitals,” Gakuya said.
Daule unveils tricks used to defraud SHA
Gakuya’s remarks follow Health Cabinet Secretary Aden Duale’s revelation on how hospitals have devised elaborate schemes to defraud the Social Health Authority (SHA), siphoning billions of shillings meant for patient care.
Speaking on Monday, August 25, 2025, at Afya House in Nairobi, Duale said the fraud has undermined the TaifaCare programme and placed a heavy burden on taxpayers.
The tricks were exposed during an audit exercise.
Upcoding
One common practice is upcoding, where hospitals intentionally submit codes for more severe or expensive diagnoses and procedures than those actually performed. This allows providers to receive larger payments than warranted, diverting public funds away from genuine healthcare services.
Falsification of Records
Another widespread method is the falsification of records, in which hospitals submit altered or false medical documents to secure higher reimbursements.
This contravenes Section 48(5) of the Social Health Insurance Act, 2023, and Regulation 34(2) (f) of the Social Health Insurance Regulations, 2024.
Conversion of Outpatient to Inpatient
Hospitals have also been converting outpatient visits into inpatient claims. Routine visits are billed as full hospital admissions to inflate reimbursements, a manipulation that further drains public resources.
This is usually done to receive a higher reimbursement from insurance companies, including government programs.
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.
