The National Hospital Insurance Fund (NHIF) has flagged hospitals in Nyamira, Homa Bay and Migori counties that were involved in various forms of fraud.
The scam involves nine hospitals in three counties where healthcare providers claimed to have performed various operations and procedures when, in fact, they did not.
A memo from the national insurer shows that most of the facilities have been flagged for possible fraudulent surgical procedures and fraudulent claims.
Others were found to be sub-standard and do not meet the minimum threshold for admitting patients.
Roman Annex Medical Centre at Kemera and Roman Medical Centre at Magombo in Nyamira County, which is listed among the facilities involved in fraud, was found to employ non-licensed health professional staff as well as taking part in falsified admissions.
Samjomen Hospital in Migori was found to be "conducting several emergency caesarian sections, an indication of fraudulent activities”.
The issue of unnecessary surgeries has previously been mentioned as the top form of fraud against NHIF.
NHIF paid Sh6.9 billion for those claims, with Sh5.6 billion going to settle major surgeries and a further Sh610 million spent on specialised surgeries.
The national insurance scheme spent a further Sh667 million towards coverage of minor surgeries.
NHIF has previously admitted to losing millions through fraud.
In 2017, the insurer said that it had invited detectives from the Directorate of Criminal Investigations to probe the loss of up to Sh500 million every month through fictitious claims.
The insurer blamed the increase in fictitious claims on collusion between a section of the Fund’s unscrupulous employees and some hospitals.