The Social Health Authority (SHA) is battling a storm of controversy after reports suggested it had wired nearly Sh20 million to a “ghost hospital” in Homa Bay County. Images of a deserted building, circulating widely on social media, fueled suspicions that taxpayers’ money had been siphoned to a non-existent facility.
However, SHA Chief Executive Officer Dr. Mercy Mwangangi has dismissed the claims as misleading, insisting that the funds were legitimately paid to Nyandiwa Level 4 Hospital in Suba South, Homa Bay County, a facility she says has been operational for decades.
“Nyandiwa Level 4 Hospital, formerly Nyandiwa Dispensary, has been serving the public since the 1970s. During its upgrade to a Level 4 facility, it retained its original bank account name, which is why confusion has arisen,” Dr. Mwangangi explained.
“The disbursement of Sh19,998,720 represents legitimate and accumulated claims duly processed in line with SHA’s strict verification and payment protocols. SHA does not and will never disburse funds to non-existent or uncontracted facilities.”
Nyandiwa Dispensary in Kasipul Constituency, Homabay County
Confusion Over Two Nyandiwas
At the heart of the mix-up is a naming discrepancy. The hospital in question retained the account name Nyandiwa Dispensary despite its transition to a higher-level facility. Adding to the confusion is the existence of another Nyandiwa Dispensary in Kasipul constituency, which has no affiliation with SHA.
The abandoned structure that went viral on social media, with journalists describing a locked gate, peeling walls, and even a cow grazing nearby, was never contracted by SHA. According to Dr. Mwangangi, it was an incomplete project left behind by a former county administration and has no transacting rights with the authority.
“These claims are misleading and undermine responsible journalism. A simple verification with SHA or the Homa Bay County Department of Health would have clarified the difference between the operational Nyandiwa Level 4 Hospital and the abandoned structure in Kasipul,” Dr. Mwangangi said.
Nyandiwa Level 4 Hospital
The Bigger Picture: SHA’s Role and Funds
The Nyandiwa saga comes as SHA oversees the rollout of the Social Health Insurance Fund (SHIF), which replaced the National Hospital Insurance Fund (NHIF) in October 2024 under the Social Health Insurance Act of 2023. The SHIF aims to expand universal health coverage to include informal workers and vulnerable groups.
Since its inception, SHA has disbursed billions across the country. Dr. Mwangangi revealed that:
Sh3.4 billion has been paid to hospitals to settle SHIF claims, including inpatient services, drugs, mental health, and surgeries.
Sh1.09 billion has been disbursed under the Primary Health Care Fund, with Sh1.7 billion more being processed for dialysis, oncology, and surgical services.
Specifically for Nyandiwa Level 4 Hospital, she confirmed that the facility has received: Sh751,504 under the Primary Health Care Fund and Sh82,080,706 under SHIF since October 2024.
The Sh19.9 million payment that triggered the uproar covered inpatient long stays and maternity services between January and June 2025.
Despite SHA’s clarification, residents around the abandoned Nyandiwa Dispensary in Kasipul expressed frustration over years of neglect. “This dispensary has been abandoned for years. We trek long distances for treatment. To hear it is linked to millions is shocking,” said Barrack Omondi, a local youth who was recently hired to clear bushes around the deserted site.
Others like Ms. Emily Dan echoed the need for revived services: “I am shocked to learn that millions were disbursed while this structure remains empty. We desperately need a nearby facility that actually works.”
Health Cabinet Secretary Aden Duale has since acknowledged the confusion, attributing it to clerical and naming issues. He emphasized that Nyandiwa Level 4 Hospital remains an active, contracted facility.
SHA maintains that all disbursements are published on its website for public access after each release, demonstrating its commitment to transparency. “Every payment is subject to rigorous verification to safeguard public funds and strengthen service delivery,” Dr. Mwangangi stressed. “The public deserves accurate information on health financing reforms that are central to achieving universal health coverage in Kenya.”
