Healthcare: Why you should prioritise medical insurance

Investment is an act of putting money, time, or effort into something with the expectation of future gain. I have used the word 'investment' deliberately because having health insurance uses the same principle: you pay now to cover yourself in the future when you need it.

Official data shows that only 17.1 percent of Kenyans have some form of insurance cover. Of those who reported having health insurance, 83 percent were covered by the Social Health Authority (SHA), the government agency established to oversee and regulate Kenya's new healthcare financing system.

This means that for every two Kenyans with medical coverage, eight others are without any form of protection. These uninsured Kenyans have to dip deep into their pockets to pay for healthcare, paying a heavy price in the process.

Often times, even after selling their assets, such as cows and crops, or fundraising from family and friends, they are still left with a huge hospital bill.

Data from the Kenya National Bureau of Statistics show that 100 million outpatient visits were made in 2022, of which 80 million were paid in cash.

Affordability is the main reason many Kenyans have not taken up medical insurance, followed by lack of knowledge and awareness.

The average cost of an outpatient visit to a clinical officer is about Sh500. A medical officer will cost you Sh1,000 to Sh2,000. A consultant would charge between Sh2,000 and Sh3,000 per visit.

A basic laboratory test would be anything between Sh200 to Sh1,000. A visit to a pharmacy would cost you between Sh200 and Sh1,000.

Paying for healthcare in cash has been known to impoverish families. But this can be avoided by getting an insurance cover. Private insurance would give an outpatient cover of Sh50,000 per annum with an average visit cost of Sh3,500.

An extended investigation that goes into a biopsy, MRI, or CT scan would cost you anything between Sh6,000 to Sh40,000 depending on the test.

A night spent in a “Budget Hospital” would cost you Sh5,000 to Sh10,000 a night. Minor theatres range from Sh30,000 to Sh80,000, while major ones would cost you between Sh150,000 to Sh1 million.

Regular care like dialysis and chemotherapy would cost Sh10,000 and above per visit. Intensive Care Unit and High Dependency Unit cases cost between Sh30,000 a night to Sh100,000 or more a night, depending on the case.

Yet, the average income for a Kenyan is around Sh20,123, according to KNBS. Most of the working class or aged Kenyans have dependents, including children, parents, relatives, spouses, and sometimes friends. What this implies is that most Kenyan incomes are not sufficient to pay for healthcare out of pocket.

In a real sense, insurance should protect you in a situation that you are unprepared for. Just like investments, long-term planning is essential when it comes to your health. It requires active management and strategic planning.

You should be aware of the risk sickness causes to yourself, family and friends. Not only does it erode your wealth, savings, and investments, but it can also sometimes lead to loss of lives.

Hospitals and Medical practitioners, more so in the private sector, would rarely treat you without insurance cover, which to them is a guaranteed payment. Needless to say, good doctors, hospitals, and care come at a cost.

Investing in your and your loved ones’ health is more important than wealth because it can lead to loss of life. Take your time to study, research, and invest in a product that will protect you in times of need.

It also doesn’t help that we currently have issues with SHA, which is supposed to cover most Kenyans as part of the government's goal of achieving universal healthcare (UHC).

Recently, most hospitals have stopped issuing services under this State-backed insurance, exposing most people who don’t have private insurance from getting services and therefore risking their lives.

So, how to you choose the right insurance cover?

First, you need to consider yourself and your dependents. First, you need to take into account your health status, the age of each one of you, and what you can afford to pay for yourself and your family.

Secondly, consider the product. What product suits you and your dependents? If you have children, you would, for example, consider having an outpatient cover since they develop regular coughs, headaches, infections, etc. If you are 50 and above, the product you consider should match your health needs.

Thirdly, you should consider who is selling you the product. It’s an open secret that certain insurance companies face challenges. For instance, some take long to approve procedures, which poses a challenge to you or your dependents in case of emergencies. Some insurance companies also have limited health providers in their panels or are restrictive.

You must consider if this will affect you since you might be forced to seek help in a facility that is not geographically convenient to you.

You might also be forced to pay out of pocket because maybe the insurance company doesn’t have that specific practitioner in their panel. Certain insurance companies also don’t pay providers and are therefore blacklisted by the providers.

Insurance premiums are expensive to most, but there are ways to ease this burden. Insurance premium financing is one of them. We have various companies that exist for insurance premium financing. They pay the insurance premium for you, and you pay them in installments over a period of time at an interest. Most banks do the same under their bancassurance.

The writer is the Executive Director, Luton Medical Hospital