Approximately 7.4 million small and medium-sized enterprises (SMEs) constitute a crucial part of Kenya’s economy, contributing 40% of its GDP and employing nearly 78% of its workforce.
Despite their significant economic role, many employees of SMEs and their families lack adequate health insurance coverage, as highlighted by recent data from the National Bureau of Statistics (KNBS). Only 19% of Kenya’s population currently has health insurance, exposing a large majority to the financial uncertainties associated with healthcare expenses.
For SME workers, this gap in health coverage poses a substantial challenge to their financial security and overall well-being. The primary obstacle cited by 94% of small employers is the cost of providing health insurance, with nearly half describing it as very difficult.
The burden of offering comprehensive health benefits often exceeds the financial capacities of these businesses, limiting their options for providing adequate coverage.
Moreover, the health insurance options available to SMEs often come with unfavorable terms. Many struggle to access group coverage benefits due to stringent eligibility criteria based on the number of employees. Even when coverage is secured, SMEs and their employees face additional challenges such as extended waiting periods, co-payment requirements, and complex policy structures that include age limits for policy renewal.
This challenging landscape underscores the need for a reevaluation of health insurance policies that cater to the needs of SMEs and their workforce. There is a clear call for policy reforms that promote affordable and accessible healthcare solutions, ensuring that SMEs can thrive while providing essential health benefits to their employees.
Policymakers need to collaborate closely with industry stakeholders to develop strategies that alleviate the financial burden on SMEs while improving the accessibility and scope of health insurance options. These efforts could involve targeted subsidies, regulatory adjustments, and innovative public-private partnerships aimed at expanding coverage and reducing costs for small businesses.
Furthermore, there is a critical need for enhanced awareness and educational campaigns. These initiatives can equip SMEs with the knowledge and resources necessary to navigate the complexities of health insurance effectively. By promoting a culture of proactive risk management and financial planning, SMEs can make informed decisions that protect the health and well-being of their employees and their families.
Companies like Old Mutual Health are leading by example in driving these changes forward. Recently, they overhauled their SME Health offering by eliminating waiting periods, removing co-payment requirements, supporting lifelong policy renewals, and extending coverage to organizations with as few as three employees.
These actions are crucial in bridging the health insurance gap for SMEs, ensuring that everyone has access to essential healthcare solutions.
