Audit exposes cash sinkholes in Tanzania health fund

Monday April 22 2024
tz uhc

Tanzania NHIF has more than five million members and faces a review through the Universal Health Insurance Act passed in 2023. PHOTO | SHUTTERSTOCK


Tanzania’s beleaguered National Health Insurance Fund (NHIF) is on the verge of bankruptcy, blamed on the government's failure to pay a huge debt and rising fraud in card use, according to the latest audit on public sector expenditure.

The Controller and Auditor General’s report for the 2022/2023 financial year, which was made public this week, says that NHIF made a loss of Tsh156.77 billion ($60.76 million) during the year.

Although this is a 24 percent drop from the Tsh205.95 billion ($79.82 million) loss reported in 2021/2022, it is still the highest among public entities.

The Fund's financial situation was compounded by accumulated debts of Tsh208 billion ($80 million) owed by the government itself and a Tsh137.8 billion ($53 million) bill for treatment of non-communicable diseases alone.

Read: Tanzania suspends new reduced NHIF rates

“Efforts are being made to clear the debts, but the fund is bearing a big financial burden.”


The NHIF, which currently has more than five million paying members, has been at loggerheads with private hospitals and pharmacy owners for some years over delayed refunds or payments for services provided to patients through NHIF cards.

Health authorities are trying to revitalise the Fund under a new Universal Health Insurance Act passed last year and was set to become operational this month (April) but remains stalled by an ongoing dispute between government and private healthcare providers over the revised payment rates for services rendered.

The new UHI legislation removes tax exemptions previously granted to healthcare services while compelling every Tanzanian to enroll in a recognised health insurance scheme.

It also doesn’t directly address challenges posed by the fast spread of non-communicable diseases in Tanzania which require costly treatments including regular CT scans and MRI tests.

Cost of buildings

According to CAG’s report, other state firms that recorded particularly big losses for the year were the TIB Development Bank at Tsh131.07 billion ($51.4 million), Tanzania Railways Corporation at $39.49 million, Tanzania National Oil company at Tsh76.56 billion ($30 million), and national carrier Air Tanzania at Tsh56.64 billion ($22.19 million).

Read: EA nations' hurdles in providing cheap healthcare

The report also noted the high rental expenses for Tanzania missions abroad with inflated rental charges for offices and accommodation.
Tanzania’s 39 foreign missions spent Tsh18.46 billion ($7.1 million) through office and residential rentals.

The CAG said that rehabilitation of the Chancery in Kampala was not implemented despite Tsh1.78 billion ($657,873) being paid to the contractor in Uganda since July 2018.

Mr Kichere further said that rehabilitation of the old chancery building in Washington D.C. had encountered setbacks, including inflated costs from unjustified value added tax of 20 percent.

President Samia Hassan earlier this month directed the ministers to take action on queries raised by the auditor.

She ordered them to take appropriate actions on responsible individuals and public departments mentioned in the report before the parliament take it for deliberation.

The CAG reports include performance audits for local government departments, public business corporations and the Central Government.