This archive report was first published on 15 June 2021.
On June 16, 2021, the High Court ruled in favor of Meridian Medical Centre, ordering the National Hospital Insurance Fund (NHIF) to pay Sh130 million in a contract dispute.
The dispute dates back to June 2012, when NHIF terminated a contract with Meridian Medical Centre for outpatient services after just six months, citing public outcry over the non-availability of the clinic's services nationwide.
However, High Court judge Maureen Odero found that NHIF had entered into the contract without first establishing whether Meridian Medical Centre had the capacity to fulfill its obligations.
‘I find it hard to believe that the defendants entered into such a major contract without first establishing that the provider had the capacity to fulfill its obligations under the contract,’ Judge Odero said.
The amount owed includes Sh12.4 million for a six-month pilot project and Sh118 million for the second quarter of the contract.
Justice Odero ruled that the contracts were duly executed by NHIF's board and therefore the insurer cannot escape its obligations.
‘As such, I find that there do exist a valid and enforceable contracts between the Plaintiff (Meridian) and the Defendant (NHIF) and that the said contracts created binding obligations between the two parties,’ the judge said.
Meridian Medical Centre had initially won a contract for a pilot project in September 2008, which ran from January to June 2010. The facility later won another contract for provision of out-patient services for civil servants and disciplined forces, to run for three years starting January 2012.
