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Explanation: What is Public Officers Medical Scheme Fund?

Kindly note that this is explanation on new statutory deduction on teachers payslips. The deduction also covers all public officers, civil servants included.

EXPLANATORY MEMORANDUM

EXPLANATORY MEMORANDUM FOR THE PUBLIC FINANCE MANAGEMENT (PUBLIC OFFICERS MEDICAL SCHEME FUND) REGULATIONS, 2024

PART I

Name of instrument: Public Finance Management (Public Officers Medical Scheme Fund) Regulations, 2024.
Name of Parent Act: The Public Finance Management Act (No. 18 of 2012).
Enacted Pursuant to: Section 24(4) of the Public Finance Management Act, 2012
Name of Ministry: The National Treasury & Economic Planning/ State Department for Public Service
Gazetted on: To be advised by the Hon. Attorney-General
Tabled on: To be advised by the Clerk of the National Assembly

PART II

Purpose of the Statutory Instrument

The purpose of this Statutory Instrument is to establish a Fund to be known as the Public Officers Medical Scheme Fund whose objects and purpose shall be to finance the provision of a medical scheme for public officers in addition to the social health insurance benefit package provided under the Social Health Insurance Act.

The Fund shall also facilitate expenses approved by the Administrator of the Fund to promote the objects for which the Fund was established.

Legislative Context

The National Assembly delegated the duty to establish national public funds to the Cabinet Secretary responsible for finance with the approval of the National Assembly.

This is provided for under Section 24 (4) of the Public Finance Management Act, 2012.

The Regulations are therefore developed within the meaning of Section 24 (4) of the Public Finance Management Act 2012 and the procedure for public participation provided under the Statutory Instrument Act, 2013.

Policy Background

The Government of Kenya introduced a comprehensive Medical Insurance Scheme for civil servants and disciplined services and their eligible dependents named Comprehensive Medical Insurance Scheme for Civil Servants & Disciplined Services (the Scheme).

The scheme was rolled out with effect from 1^st January 2012 and has been in operation until the establishment of the Social Health Authority.

The Scheme started with basic coverage of a principal member and three (3) dependents and was four years later enhanced to a principal member and six (6) dependents.

The benefits package was also improved and currently includes outpatient, inpatient, and specialized services, dental, optical, annual medical checkups for member and spouse, road ambulance, emergency air rescue services, overseas treatment, group life and last expense cover.

Social Health Authority facilitates access for all Kenyan residents to a comprehensive range of quality health services.

These services include integrated preventive, promotive, curative, rehabilitative, and palliative health services at level 4, 5, and 6 health facilities.

For civil servants to continue receiving medical benefits as part of their remunerations, a Fund is proposed to enable civil servants first to receive the comprehensive range of quality health services from the Social Health Authority and, once this is exhausted, proceed with the limits provided for under the comprehensive medical insurance scheme for civil servants and disciplined services (renamed Public Officers Medical Scheme).

The proposed Public Officers Medical Scheme include civil servants and any other participating group of public officers.

Funds recovered from their medical benefits will be channelled to the Fund established to support the Scheme.

Civil servants and all other participating public servants of the proposed Public Officers Medical Scheme shall continue contributing to the Social Health Authority through payroll deductions.

Guidance

The National Treasury and Economic Planning, the State Department for Public Service and the Social Health Authority shall sensitize the National Assembly, the Civil Servants Unions, the general public, and various stakeholders on the objectives of the Public Officers Medical Scheme Fund.

Stakeholder Consultations

In line with the provisions of Section 5 of the Statutory Instruments Act, 2013, the National Treasury and Economic Planning together with the State Department for Public Service, undertook public participation before publication of these Regulations.

The Team responsible for preparing and developing the Regulations held targeted consultations with key stakeholders, and their input was considered before the finalization and publication of these Regulations.

These included The National Treasury and Economic Planning, the State Department for Public Service, the Social Health Authority, the National Assembly, the Civil Servants Unions, and the general public.

The mode of public participation included the invitation of key stakeholders via an advertisement posted on the National Treasury website and published in the My Gov on 12^th November 2024.

Written responses/submissions on the Regulations were sent to ps@treasury.go.ke and copied to jona.wala@treasury.go.ke

Review

The National Treasury shall monitor the application of the Regulations. This shall be done through the quarterly and annual reports prepared by the Fund and forwarded to the National Treasury.