If you earn a payslip in Kenya, you have seen the deduction: 2.75% of your gross salary going to the Social Health Authority (SHA) every month. And if you also pay for a private medical cover — or your employer provides one — you have probably asked the obvious question: am I paying for the same thing twice?
The short answer is no. SHA and private medical insurance do different jobs, and understanding where one stops and the other starts is the key to getting real value from both. Since SHA replaced the National Hospital Insurance Fund (NHIF) in October 2024, this has become one of the questions we answer most often as insurance brokers.
This guide explains what SHA actually covers, what private medical insurance adds on top, and how to decide what your family or business needs — in plain language.
What SHA Is and How It Works
The Social Health Authority (SHA) is the government body that took over from NHIF under the Social Health Insurance Act, 2023. Registration is required by law for everyone living in Kenya — employed, self-employed, or not earning at all. You can register or check your status on the official Social Health Authority (SHA) website or at a Huduma Centre.
Contributions are income-based: salaried employees contribute 2.75% of gross monthly salary, deducted and remitted by the employer. Households without a salary contribute 2.75% of household income, with a minimum of KES 300 per month.
Your contributions feed a system built around three funds:
- The Primary Healthcare Fund — pays for everyday care at smaller public facilities (dispensaries, health centres), free at the point of use
- The Social Health Insurance Fund (SHIF) — the contributory fund your 2.75% goes into; it pays for treatment at larger hospitals, within set benefit limits and tariffs
- The Emergency, Chronic and Critical Illness Fund — steps in for emergencies and for chronic or critical illness costs once SHIF benefits run out
That structure is genuinely useful — it means every registered Kenyan has a baseline of cover. But it comes with real limits: treatment happens at facilities contracted by SHA, benefits are paid at set tariffs, and you do not choose the payout level. If the hospital you prefer charges above the SHA tariff, the difference is yours to cover.
What Private Medical Insurance Offers
Private medical insurance is a contract you choose. You pick the benefit level, the insurer, and — within the insurer’s hospital panel — where you are treated. In practice, that translates to:
- Choice of hospital, including the private and mission hospitals many families prefer for major treatment
- Higher inpatient limits — plans commonly run from a few hundred thousand shillings to KES 10 million and beyond per person per year
- Outpatient cover as an optional benefit — doctor visits, diagnostics and prescriptions without paying cash at the clinic
- Extras you can add: maternity, dental, optical, and last-expense benefits
- Speed and comfort — shorter queues, private wards, and direct billing so you are not fundraising at the admission desk
The trade-off is that private cover is priced by risk: premiums depend on your age, family size and the benefit level you choose, and policies come with waiting periods and exclusions you should read before signing. Our Individual & Family Medical Cover page explains the typical benefit structure in detail.
SHA vs Private Medical Cover at a Glance
| Question | SHA | Private medical insurance |
|---|---|---|
| Is it compulsory? | Yes — for everyone living in Kenya | No — your choice |
| What does it cost? | 2.75% of income (minimum KES 300 per month) | Priced by age, family size and benefit level |
| Where can you be treated? | SHA-contracted facilities, at set tariffs | The insurer’s hospital panel, including major private hospitals |
| Benefit limits | Set nationally — same for everyone | You choose the level when you buy |
| Outpatient, dental, optical | Limited, facility-dependent | Available as optional benefits |
| Who is covered? | You and declared dependants | You choose who is on the policy |
Do You Need Both?
For most people, the honest answer is that the question decides itself: SHA is not optional. Registration and contributions are a legal requirement whether or not you hold private cover. So the real decision is whether to add private medical insurance on top — and that depends on what you want to happen on the day someone in your family needs serious care.
For families
SHA gives your household a foundation. Private cover decides the experience built on it: which hospital you walk into, whether outpatient visits are cashless, and how large a bill the cover can absorb before you contribute. Families that want their children seen at a specific hospital, or want maternity handled privately, usually pair SHA with an individual and family cover sized to their budget.
For employers
Deducting and remitting the 2.75% SHIF contribution is a statutory duty — it is not an employee benefit, and staff know the difference. A group medical scheme remains one of the strongest retention tools an employer has, and it works alongside SHA rather than instead of it. Our SME Medical Cover page covers group options sized for smaller teams.
For parents and older family members
This is where the gap between the two shows most. Chronic-condition management, specialist consultations and comfortable inpatient care are exactly where set tariffs feel tightest — and where a dedicated seniors medical cover earns its premium. Note that private covers for older members have entry-age limits, so the best time to arrange one is earlier than most families expect.
How SHA and Private Cover Work Together
When you are admitted to hospital with both covers in place, they coordinate rather than compete. In most cases the SHA benefit contributes first at its set tariff, and the private insurer tops up the balance within your policy limits. Two practical habits make this seamless:
- Keep your SHA contributions current. Some private insurers expect an active SHA status when settling inpatient claims, and a lapsed status can slow down an otherwise smooth admission.
- Declare both covers at admission. Tell the hospital and your insurer (or your broker) that you hold both — the billing desk will sequence them correctly from the start.
Before You Buy a Private Cover: Four Things to Check
Private medical policies differ far more than their brochures suggest. Whichever insurer you are considering, put these four questions to the policy document before you pay:
- The waiting periods. Most covers apply waiting periods before certain benefits start — maternity and pre-existing or chronic conditions are the usual ones. If a benefit matters to your family this year, confirm when it actually switches on.
- The hospital panel. A generous benefit limit means little if the hospital your family actually uses is not on the insurer’s panel. Check the list against the facilities you would realistically walk into — including the ones near shags, not just in town.
- The inpatient / outpatient split. Inpatient cover is the financial backbone; outpatient is the convenience layer — and it is usually where premiums climb. Decide deliberately whether you want clinic visits covered, or whether a strong inpatient limit alone fits your budget better.
- Exclusions and co-payments. Read what the policy will not pay for, and whether any hospitals on the panel carry a co-payment — an amount you contribute per visit. Two covers with the same headline premium can behave very differently on these details.
Because premiums are priced on age, family size and benefit level, quotes for the same household can vary widely between insurers. Comparing several side by side — waiting periods, panels and exclusions included, not just price — is exactly the work a broker does for you, at no fee.
Frequently Asked Questions
Is SHA mandatory if I already have private medical insurance?
Yes. Registration with the Social Health Authority and payment of contributions is a legal requirement for everyone living in Kenya, regardless of any private cover you hold. Private medical insurance sits on top of SHA — it does not replace it.
How much do I pay for SHA in Kenya?
Salaried employees contribute 2.75% of gross monthly salary, deducted and remitted by the employer. Households without a salary contribute 2.75% of household income, with a minimum of KES 300 per month.
Can I still use my preferred private hospital under SHA?
SHA pays for treatment at facilities it has contracted, at set tariffs. If your preferred hospital charges above those tariffs — as many private hospitals do — the difference is payable by you. Covering that gap is precisely what private medical insurance is designed for.
Does SHA replace my employer’s group medical cover?
No. Employers must deduct and remit SHIF contributions as a statutory obligation, and a group medical scheme remains a separate benefit on top. Most employers keep their group cover because it protects staff at hospitals and benefit levels SHA tariffs do not reach.
What happened to my NHIF membership?
NHIF was wound down when the Social Health Authority took over in October 2024. NHIF membership did not carry over automatically — you need to be registered with SHA. You can confirm or complete your registration on the official SHA website or at a Huduma Centre.
Getting the Balance Right
SHA gives every Kenyan a health-cover foundation; private medical insurance decides how much choice, speed and financial headroom sit on top of it. The right balance is different for a young family, a growing business and a retired parent — and finding it is exactly what a broker is for. Talk to us about your situation, or explore our Individual & Family and SME Medical covers — our advice comes at no fee to you.
