Kenyatta National Hospital is once again at the centre of financial controversy after the Auditor General, Nancy Gathungu, revealed a trail of losses running into hundreds of millions.
The country’s biggest referral hospital, which is supposed to stand as a pillar of public health, has instead been sinking deeper into financial distress due to questionable contracts, unpaid reimbursements, and stalled projects.
This situation not only threatens its ability to function effectively but also raises serious questions about accountability within the Ministry of Health.
The Auditor General’s report points to losses of Sh678.4 million caused by irregular contracts and poor financial management.
Among the key findings are Sh459.2 million lost through the now-defunct National Hospital Insurance Fund and another Sh219.2 million from the Linda Mama programme.
These two areas alone have left the hospital crippled, unable to maintain the level of service expected at such a critical institution.
Patients who depend on subsidised or free maternity services have been the most affected as the hospital continues to struggle with cash flow problems.
Delays in reimbursements from the Ministry of Health have added to the mess.
KNH was supposed to be compensated for services offered under Linda Mama, yet between 2016 and 2023 payments were irregular and insufficient.
By June 2024, pending bills under this programme alone had risen to Sh219.2 million, leaving the hospital with huge financial gaps.
Even where government reimbursements were made at Sh3,500 per delivery, the figure was far below the actual costs incurred for specialised care such as neonatal services and critical treatment, meaning the hospital absorbed more losses with every patient it treated.
The overall financial picture has grown worse, with accumulated losses rising by 13 percent. The latest report shows that by 2024, KNH was staring at Sh1.91 billion in losses, up from Sh1.7 billion the previous year.
This trend paints a bleak outlook for the institution, suggesting that without reforms it risks sliding further into financial paralysis.
Equally disturbing are revelations about stalled capital projects.
The Medical Oxygen Generation Plant valued at Sh657.2 million has not been completed, while the Paediatrics’ Emergency and Burns Centre, originally budgeted at Sh1.2 billion but later inflated to Sh1.7 billion, has also stalled.
Even worse, the project’s cost is now pegged at Sh4 billion with no clear way forward. The concessionary loan funding the Burns Centre expired in July 2024, yet there is no evidence of renewal, leaving the future of the facility uncertain despite millions already sunk into it.
The Auditor General has warned that unless strict measures are put in place, KNH will keep losing money especially through government-funded programmes that do not reflect the real cost of treatment.
Her findings have also exposed weaknesses in procurement and contract management, with concerns that laws such as the Public Procurement and Asset Disposal Act were ignored.
These revelations pile pressure on the Ministry of Health to step in and stop the bleeding before the hospital collapses under the weight of mismanagement and debt.
The crisis at KNH is not only about numbers but about lives.
As long as funds are mismanaged and projects abandoned, patients who depend on the hospital for affordable healthcare will continue to suffer.
The report now forces Kenyans to demand accountability and reforms that can restore confidence in the country’s top referral hospital.
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