Health Cabinet Secretary Aden Duale has dismissed claims that the Government is unlawfully paying public funds to a private company through fees charged on claims processed under the national digital health system.

Duale described a report published by the Daily Nation on August 4, 2026, as false and malicious, insisting that the digital health system is firmly anchored in law and is essential to the implementation of Universal Health Coverage.

The CS said the Government cannot effectively register, verify and pay for healthcare services for millions of Kenyans using manual, paper-based systems.

He cited Section 47 of the Social Health Insurance (SHA) Act, which requires processes including member identification, pre-authorisation, claims management and settlement of claims to be digitised through a secure, interoperable and verifiable information system.

According to Duale, the Government has established a single digital platform through which the country's health financing system can be verified and managed.

“Such a system must be built, secured, run and maintained, and the law provides for how it is paid for,” he said.

Duale explains 2pc digital service fee

Duale further clarified that the service fee charged for use of the digital health system is not a discretionary levy.

He pointed to Regulation 11(2) of the Digital Health (Data Exchange Component) Regulations, 2025, which requires users of shared resources within the system to pay the prescribed service fee.

The CS said the Third Schedule to the regulations sets the fee for Health Information Management Services at two per cent of the service offered through HIMS, subject to a maximum charge of Sh5,000.

He maintained that the fee is therefore capped and should not be interpreted as an open-ended deduction from hospital earnings.

“It is therefore a capped fee for the use of a system. It is not an open-ended share of any hospital’s earnings,” Duale stated.

Digital Health Agency receives fee

The CS said the money is payable to the Digital Health Agency, a State agency established under the Digital Health Act, 2023.

He explained that the agency is responsible for the Comprehensive Integrated Health Information System established under Section 15 of the Act, while Section 48(1)(c) allows the agency's funds to include levy fees for services it provides.

“This is a charge by a public body, for a public system, authorised by statute,” Duale said.

He also rejected suggestions that private entities have control over money meant for healthcare providers.

Duale cited provisions of the SHA Act granting the Social Health Authority powers to review, process and pay claims to contracted healthcare providers from funds established under the law.

He insisted that these responsibilities have not been delegated to a private company.

Government defends Safaricom consortium contract

Duale said the digital health system is being delivered through a Government contract with the Safaricom Consortium, procured under the Public Procurement and Asset Disposal Act.

He noted that the law permits subcontracting, arguing that the engagement of a subcontractor by a contracted party does not automatically make the subcontractor a recipient of public funds outside the law.

The CS stressed that the arrangement also does not give any private entity the authority to pay healthcare providers.

Agency finances subject to public audit

Duale further assured Kenyans that funds received by the Digital Health Agency are treated as public money and are subject to established accountability mechanisms.

He said the agency's accounts are audited and reported in accordance with the Public Finance Management Act and the Public Audit Act, with its financial statements eventually tabled before the National Assembly following the Auditor-General's report.

“There is no parallel account and no hidden ledger. There is the ordinary constitutional process of public audit, and it applies here exactly as it applies to every other state agency,” he said.

The CS added that the regulations governing the digital health system underwent regulatory impact assessment, public participation and stakeholder consultations before being approved by Parliament and gazetted on April 11, 2025.

Duale: Matter now before High Court

Duale disclosed that the dispute is currently before the High Court, with the CS named as a respondent.

He said the Government will present its full response before the court and will respect the eventual determination instead of continuing to litigate the matter through the media.

At the same time, Duale assured healthcare providers that the Government remains open to addressing concerns surrounding the digital health system and claims processing.

He directed the Social Health Authority and Digital Health Agency to continue engaging healthcare providers through established stakeholder mechanisms and resolve complaints relating to claims without delay.

He said improvements would be made wherever shortcomings in the system are identified.

“To our healthcare providers, my door is not closed,” Duale said, reaffirming that the Government's priority remains ensuring that funds under the Taifa Care programme ultimately serve Kenyan patients.