Press statement: The Nairobi Hospital is financially sound and stable

The Nairobi Hospital opened its doors in 1954 as the European Hospital and ever since, it has grown from humble beginnings to a modern high-technology hospital with a bed capacity of more than 400, six outpatient centres, and a global medical evacuation centre. The combination of highly skilled medical specialists and modern medical and non-medical technology has placed the Hospital in a position to undertake a wide range of routine and complex investigations and procedures, including Open Heart Surgery, Kidney Transplants, Trauma Care, Orthopaedic Surgery, Neurosurgery, Laparoscopic Surgery, Cancer Therapy, among others.

Today, The Nairobi Hospital is renowned for emergency and trauma care, disaster response and critical care, and has excellent facilities for providing high quality clinical and nursing care. The Anderson specialty clinics opened in 2017 comprise a variety of specialty facilities, including Orthopaedic, Well Baby and Executive Clinics.

The Nairobi Hospital takes pride in highly qualified professionals who deliver our mission every day, translating their knowledge and expertise to internationally compliant practices in healthcare provision. Courtesy, consideration and unreserved respect towards our patients’ privacy, dignity and confidentiality has time and again helped us earn their trust and goodwill. Our dedicated nursing staff provides professional care within a friendly and comfortable environment, ensuring that being in hospital is a more pleasurable and less anxious time for our patients and their families. The Hospital is served with over 600 specialist consultant doctors with admitting rights, in addition to the Hospital’s doctors. This is the highest concentration of medical professionals in a single health facility in East, Central and Southern Africa.

Our facilities are world-class. With high-technology Intensive Care Unit and High Dependency Unit, and skilled specialists, the Hospital is able to undertake a wide range of complex medical procedures.

The two new theatres, occupational therapy facility, new laboratory, hydrotherapy facility, Western Entrance building, office accommodation, integration of services in Anderson Building, main laboratory and the new main pharmacy, are all testament to a superior patient experience. Most importantly, the recent installation of new plants and equipment such as the latest MRI with AI, Mammography and Fluoroscopy, two new oxygen plants and construction of an endoscopy tower, have revolutionised and redefined diagnostics and treatment at the Hospital. 

The Board has initiated the construction of a Cardiac Centre using the only Bi-Plane Cathlab in the region for launch before April 2025. This shall reduce theatre time for Cardiovascular operations from an average of three hours in theatre to an average of 30 minutes increasing survival rate of theatre cases.

Because of this long history of innovation and excellence, The Nairobi Hospital recently won a top global award for its outstanding leadership in the region’s healthcare sector, offering patients from East, Central and Southern Africa the best care using advanced technology in an atmosphere of trust, safety and comfort. Last year, the Hospital scooped another global award for its free treatment access programme for thousands of cancer patients as one of our Corporate Social Responsibility initiatives. In fact, over the last five years, the Nairobi Hospital has won over 30 excellence awards, cementing its status as a premier healthcare facility in the region.

It is also important to mention that as part of our long-running charity initiative, The Nairobi Hospital, together with our partners, through the Hospital’s Children’s Charity Heart Fund, have sponsored free heart operations for needy children aged 0-12 years with congenital heart conditions, for several years now. This drive has seen more than 400 deserving children from different parts of the country benefit. We believe that this intervention is timely because according to World Health Organisation, over 5,000 children require congenital heart surgery in Kenya each year, and the number of children who do not receive these interventions is worrying. Note that congenital heart disease is the leading cause of birth defects and the second leading cause of death in the first year of life after infectious diseases.

This picture of long standing success at The Nairobi Hospital is as a result of the culture of good corporate governance put in place by the current Board of Management. The process of formulating governance instruments and practices that hitherto were non-existent has seen preparation and approval of new policies such as Human Resources Policy; Procedures Manual, Financial Management Policies, Credit Policy, Procurement/Supply Chain Policy, Corporate Social Responsibility (CSR) Policy – now revamped to Environmental, Social and Governance (ESG) Policy, Communication Policy, Social Media Policy, Research Policy and Business Continuity Policy. Through these policies, we have managed to professionalise all aspects of managing the affairs of the Hospital and its operations, leading to efficiency gains and cost savings.

On behalf of the Board of Management, I dare say that the allegations of corruption and poor governance being peddled around are choreographed out of frustration by individuals who have failed to manipulate our sound governance structures for their own selfish gain, and have now resorted to mounting a smear campaign against the Hospital. I urge journalists to challenge these people to table evidence of the allegations they are making against the Board of Management, because that is what responsible journalism is all about. 

Allow me now to respond to some of the allegations that have been raised by a section of Kenya Hospital Association members.

Allegations of corruption and mismanagement:The allegations of corruption at the Hospital due to conflicts of interest, cronyism and nepotism, are unsubstantiated. As already said, The Board of Management with unstinting support from the Board of Trustees, have put in place several policies which play a crucial role in enhancing good governance within the Hospital, positioning it within the global landscape of governance standards. Note that up to the year 2020, the Hospital did not have policies and other governance instruments in place, which heightened the institution’s risk exposure over a long period of time. As a Board, we challenge anyone out there who has evidence of corruption within the Hospital to come forward and table it so that the culprits can be brought to book as per the laid down policies and procedures. 

Financial performance: The Hospital’s financial base is healthy and bed occupancy has been averaging above 70%. Our staff salaries get paid by 24^th of every month and staff’s low-interest mortgage and car loan facility is already being utilised. Over the last four years, payments to our consultant doctors has not only been prompt, but a steady growth rate has also been observed each year as follows: 2020 (KES 1,124,432,729); 2021 (KES 1,298,483,331); 2022 (1,591,210,605); 2023 (1,627,123,948); 2024 (nearly a billion shillings has already been paid).

The following graphic presentations show the steady growth of monthly average payments to doctors; the Hospital’s revenue trend; and the surplus/deficit metrics in the last five years.

This trend confirms that our financial performance is promising. From a deficit of KES 565 million in 2022, which was largely due to the declined occupancy at the UN Nairobi Hospital East Wing that was exclusive for Covid-19 patients in 2021, and also the inflationary pressure and the depreciation of the shilling against major currencies at that time, the year 2023 posted a much better performance, registering a surplus of over KES 190 million. The overall 2024 Quarter 1 performance already had a surplus of KES 88 million and with the several initiatives and strategies put in place by Management, 2024 has more prospects for improved performance. From these figures, it is clear that this is not an institution that is collapsing as being alleged by some disgruntled individuals.

Infrastructure projects & investments in medical equipment: Strategy is a critical component of the Hospital’s growth agenda to ensure that it remains up to date with modern infrastructure and new technology to enhance patient care. All the projects that were pending have already been completed except those whose cases are in court or under arbitration. An inventory of all Hospital equipment has also been developed. In 2023/2024, a total of KES 844 million has been invested in medical equipment, and KES 324 million in infrastructure projects.  It is important to note that both equipment acquisition and the infrastructure projects have been financed through internally generated sources. We have not taken any loans to finance these heavy investments.

Staff ethnic representation: The Nairobi Hospital is a national asset and one of Kenya’s heritage brands. Because of this distinction, nearly all ethnic communities are represented in our staff establishment as shown in the following pie chart:

Note that these figures are historical and have not had any significant changes in the last couple of years. Our processes of recruitment are strictly guided by the Hospital’s Human Resource Policies and Procedure Manual, whose key planks are merit, equity and fairness. Before the HR Policy came into place, there were several labour-related cases, but this has drastically changed since the implementation of the HR policy commenced. This is why in 2023, we only had two labour-related cases filed against the Hospital. This underlines the importance of governance instruments in an organisation such as ours. 

Recruitment of new members to Kenya Hospital Association: Kenya Hospital Association (KHA) is a company limited by guarantee with an authorised membership of 10,000. All Kenyans of majority age who are interested in accessing the Hospital’s services as members are at liberty to join the company’s membership. Provided these Kenyans apply for membership and satisfy the Board as to the reasons for seeking membership of the company, they will be granted admission. There is in place a very clear procedure for seeking membership and approval thereof. The application of every person who seeks membership follows this procedure. The Board considers the applications and grants admission as it deems fit. All members of the company gained admission through this process.

Allegations of intimidation for Attending the Extraordinary General Meeting: Neither the Nairobi Hospital nor any of its officers has intimidated any member of the company concerning the said extra-ordinary meeting. This legal process shall be handled strictly within the confines of the law. In fact, the company has assured members that.

We note with concern that a section of KHA members have needlessly resorted to inciting our members of staff due to their own frustrations related to the extra-ordinary general meeting. There is scope within the company’s legal framework for containing this incitement. Being a country governed by the rule of law, we are content that anyone seeking to violate the law shall face appropriate legal action.

We have also observed that a section of KHA members have now resorted to inciting our members of staff into industrial action without due process instead of attending the Annual General Meeting that is slated for Friday, 27^th September 2024. There is no scope within the company’s legal framework for this incitement. Being a country governed by the rule of law, we are content that anyone seeking to violate the law shall face appropriate legal action.

The Board of Management would like to assure all our stakeholders that it is fully committed to adoption of the highest ethical standards and application of strict rules of conduct based on best practices in corporate governance, as domesticated in our Board Charter. The Charter not only remains our guiding document in directing the Hospital to maximise the long-term value of services to all our stakeholders, it also accords us the opportunity to provide a firm governance platform for the realization of our strategic objectives.

As already demonstrated, The Nairobi Hospital continues to enjoy promising performance in terms of bed occupancy and financial stability as our staff strive to offer our patients exceptional care using advanced technology, in an atmosphere of trust, safety and comfort. The institution subscribes to the International Financial Management Guidelines as enshrined in our Finance Policy. All our stakeholders and partners are hereby advised to ignore allegations being peddled by detractors that the Hospital is sliding into insolvency. Nothing can be further from the truth, because independent audits by reputable firms speak to the contrary.

We deeply appreciate the support we continue to receive from all our stakeholders, including the media, as we work to provide quality healthcare with a difference.

Thank you and God bless you all.

More information available here.

Signed

HON. DR. CHRIS M. N. BICHAGE, PhD

CHAIRMAN

BOARD OF MANAGEMENT

KENYA HOSPITAL ASSOCIATION

Friday, 13^th September, 2024