SHA vs Private Medical Cover: Which Makes Sense for Your Kenyan Business?

Your payslip shows a 2.75% SHA deduction every month. But you're also eyeing private medical cover for your team. They're not the same thing—and whether you need both depends entirely on what you're trying to protect.

SHA, the Social Health Authority, replaced the National Health Insurance Fund (NHIF) on 1 October 2024. It works like a foundation. All salaried employees contribute 2.75% of gross monthly income, with a minimum of KSh 300 per month. Spouses and children of a contributing member are automatically covered.

SHA covers primary healthcare—consultations at Level 2–3 facilities, basic drugs, immunizations, family planning—free at point of service for active members. Inpatient care is covered at SHA-accredited hospitals (most public, some private), and maternity including antenatal, delivery and postnatal is included. The government announced free maternity services at Level 2 and Level 3 hospitals, with cancer treatment support increased to up to KSh 800,000.

But here's where SHA stops. SHA does not cover cosmetic procedures, experimental treatments, alternative medicine, private ward upgrades beyond standard ward cover, or some elective procedures. Public facilities and some SHA-contracted hospitals face high patient volumes; you may experience longer wait times compared to private insurance with priority access. SHA covers a defined basic package at contracted facilities, not necessarily the hospital you want or the speed you need.

Private Medical Cover: What You're Actually Paying For

Comprehensive local private cover commonly costs KSh 30,000–55,000 per employee per year, while premium designs cost KSh 50,000–100,000+ per employee per year. That sounds steep. But it buys something SHA does not: choice.

Private medical cover is what you add on top for private hospitals, higher limits, shorter waits and benefits SHA does not fund—including treatment at private hospitals of your choice, much higher annual limits for serious admission, shorter or no waiting for elective care, and extras like maternity, dental, optical and overseas referral. Private health insurance offers broader access including premium private hospitals, specialist consultants, outpatient services, maternity, dental, and optical with faster service and cashless admission.

For a business trying to retain talent, that matters. Skilled professionals in banking, tech, FMCG, and healthcare routinely compare medical cover packages when evaluating job offers; offering robust cover reduces turnover and recruitment costs significantly.

The Real Question: SHA Alone, or SHA Plus Private?

SHA gives everyone a baseline of cover, and private health insurance adds higher limits and more hospitals on top. Understanding where one stops and the other starts is the key to getting real value from both. Many Kenyan businesses do both.

You are already paying into SHA. Your employees cannot opt out. So the real choice is whether to layer private cover on top. That depends on three things: what your employees earn, what you can afford, and what hospitals they actually need.

If your payroll is mostly entry-level staff, SHA alone meets legal requirements. Unlike private insurance that charges per person, SHA's 2.75% contribution covers your entire household (spouse and children) at no extra cost. If your team is technical or professional, private cover stops them leaving for a competitor with better benefits.

Several insurers now sell low-cost SHA top-up riders that bridge the gap between SHA's basic benefit and private-hospital charges, typically for a modest annual premium. It's not comprehensive private cover, but it's the middle ground.

How to Register and Get It Done

SHA registration is free and mandatory for employed Kenyans; register via sha.go.ke or dial *147#. If you run a business, your payroll system should handle SHA deductions automatically.

For private medical cover, the main private insurers in Kenya are Jubilee Health, Britam, AAR, UAP Old Mutual, Madison, APA, CIC, Sanlam and First Assurance, all licensed by the Insurance Regulatory Authority. Find a verified Kenyan expert on Kaziiko who brokers group medical schemes—they can compare terms and negotiate volume discounts for your staff. Corporate medical insurance premiums are generally deductible as a business expense under Kenyan tax law, reducing the net cost of providing cover.

Frequently Asked Questions

Do I have to provide private medical cover for my employees?

2.75% SHIF deduction is mandatory; private medical insurance is a market benefit rather than a general legal requirement. But offering it is a competitive advantage, especially if you want to hire and keep skilled staff.

Can my employees use SHA and private insurance together?

From 2025 the government and insurers began linking private cover to SHA, with SHA increasingly acting as the first payer and private plans topping up, so the two are designed to work together rather than instead of each other. SHA covers services at contracted public facilities, and private insurance covers private hospitals and extras on top.

Which hospitals accept SHA?

Not all healthcare facilities in Kenya are SHA-accredited; SHA cover is only available at registered hospitals, clinics, and pharmacies. Check sha.go.ke for the accredited facility list in your area. Many private hospitals do not accept SHA or have limited contracts, which is one reason private cover appeals to businesses.

Is SHA enough if I want my team covered at places like Nairobi Hospital?

No. SHA covers healthcare at contracted public facilities and some private hospitals, but SHA is still experiencing reimbursement delays, limited private hospital access, and operational challenges. If you want your team using premium private providers, you need private insurance on top.