The government has moved to settle long-standing debts owed to healthcare facilities by allocating Ksh4 billion in the current 2025/26 financial year to clear verified pending bills accumulated under the National Hospital Insurance Fund (NHIF).

Treasury Cabinet Secretary John Mbadi, while presenting the 2026/2027 budget on June 11, 2026, said the funds are specifically earmarked for the payment of outstanding claims owed to contracted healthcare facilities.

Mbadi acknowledged the critical role played by healthcare facilities in delivering medical services to Kenyans and said the government was committed to honouring its obligations.

“The government recognises the critical role the contracted healthcare facilities play in the delivery of healthcare services to Kenyans. It is with this in mind that the government in the current fiscal year (2025/26) allocated Ksh4.0 billion for settlement of outstanding National Hospital Insurance Fund (NHIF) pending bills,” he said.

The payment period

The CS noted that the allocation targets healthcare facilities with claims not exceeding Ksh10 billion, following a presidential directive prioritising the clearance of such debts.

According to Mbadi, all claims earmarked for settlement under the KSh4 billion allocation have already undergone verification and adjudication processes and will be fully paid before the close of the current financial year.

“The claims earmarked for settlement under this allocation have been duly verified and adjudicated and will be fully paid before the close of this financial year,” Mbadi stated.

Ksh10 billion threshold

According to Mbadi, the move is expected to provide relief to hospitals and other healthcare providers that have faced cash flow challenges due to delayed reimbursements from NHIF, which was replaced under the government’s health financing reforms.

Mbadi further assured healthcare providers with larger outstanding claims that the government would address their concerns in subsequent budgets.

“The government will subsequently prioritise payment of the outstanding claims exceeding the Ksh10 billion threshold once verified in the next budget,” he said.