Investigative Report: The Truth Behind The Nairobi Hospital’s Financial Woes

Nairobi Hospital

Recent developments within the management of Nairobi Hospital have exposed ongoing conflicts and power struggles, leading to the inevitable conclusion that the institution is in a critical condition. Kenya Insights can confirm this with certainty. The Time of Death (TOD) has been imminent for quite some time.

The leadership deficiency in the organization, has been marinated in tribalism, greed, and dictatorship.

The Nairobi Hospital has for long maintained the perfect image of professionalism and integrity, making it the premier hospital in East Africa. The hospital is where the even the ones who can’t afford wish they would.

Synopsis of the scandals: the ICT tender scandal

Investigations by Kenya Insights have revealed how this project has become the white elephant in the house, as earlier explained in our previous article. This mega-tender fraud had put on a downfall the once great healthcare institution.

Our investigations have established that the chairman of the hospital’s board, Dr. Chris Bichage (Kisii), entered into an unholy alliance with the CEO, James Nyamongo (Kisii), Company Secretary Gilbert Nyamweya (Kisii), Dr. Barcley Onyambu (Kisii), Dr. Fred Kambuni (Kisii), Dr. Meshack Ong’uti (Kisii), and other board members, much to the chagrin of other stakeholders.

The billion-shilling tender is to supply, implement, maintain, and support a hospital management information system (HMIS) and enterprise resource planning (ERP).

This tender has been on since April 2022, when the hospital advertised in the local dailies for a consultancy for the supply, implementation, maintenance, and support of HMIS and ERP. It has been one main reason for serious dissent and division amongst the Board of Directors, Senior Management, and now escalating to Admitting Staff and the Nursing Staff. Indeed, the ouster of the previous chairman was mainly to do with differences related to this ICT tender. Each group wants to own the vendor, so each procurement has been mired in gross abuse of the process.

The winning JV was awarded the contract in June 2023 at a contract sum of USD 5,643,334 (approximately KES. 960 million) for a period of five (5) years, and the contract was signed in August 2023. This has since been cancelled, and the current board chairman and the CEO have been burning the midnight oil, and crisscrossing continents to make sure the tender goes to their favorite company. Meanwhile, the hospital stands to lose USD 1.6 Million to compensate the initial JV in arbitration for expenses already incurred.

The lawyers involved in arbitration have invoiced The Nairobi Hospital a handsome KES. 65 Million, of which KES, 20 million has already been paid, even before the arbitration starts, they were obviously laughing all the way to the bank. So, in essence, this compensation money and the lawyers’ fees, will have been spent, and no ICT procured.  Meanwhile, the hospital is starting afresh, probably to receive another invoice of KES. 1 Billion. The most puzzling thing about this deal is that Kenyatta University Referral Teaching Hospital (KURTH) has recently acquired a system serving the same purpose at a humble KES. 63 Million, and it’s working. So, what KURTH paid for their system, isn’t even enough to pay The Nairobi Hospital lawyers for arbitration. It would require experts in this field to explain why a national teaching and referral hospital would find a way to spend so much less than the non-profit making Nairobi Hospital? How do you explain how for one institution KES. 63 million is enough to do what can only be achieved by no less than KES. 1 billion, in another smaller institution in the same country, less than 50km away?

There were allegations from the current chairman, CEO, and a section of the new board that the system integrator had failed to meet the required conditions in the contract, which they themselves (Dr. Chris Bichage and CEO James Nyamongo) had signed.

Mr. James Nyamongo

The Nairobi Hospital CEO, Mr.  James Nyamongo, is past retirement age. Nyamongo’s contract expired in December 2023 but was renewed under mysterious circumstances against the Nairobi hospital’s human resource code of regulations, to fulfil his personal interest in the HMIS-ERP contract. On the other hand, Nyamongo and a section of board members are happy to maintain the status quo with the current hospital’s ICT system, which has serious financial leakages for whatever reasons are best known to them. Those in the know at Kenya Pipeline are very puzzled how Nyamongo could even get his application past the Nairobi Hospital gates based on his past history in his career.

Furthermore, it is alleged that The Nairobi Hospital CEO has never gone on leave for the last three (3) years when in office, which raises many questions about the corporate governance levels of the Nairobi hospital. Under Mr. Nyamongo, the hospital went ahead to initiate a direct tendering process for selected companies by writing to companies like Microsoft, which supplied the joint venturewith the ERP in the current HMIS-ERP project, which has a running contract. This is in complete breach of the hospital’s procurement rules, where an open tender is required for any goods or services worth more than KES. 5 million.

Furthermore, it has to be passed by the full board as opposed to a section of board members. Reliable sources talking to Kenya Insights revealed that Nyamongo and other board members, namely Philemon Mwaisaka (a former Provincial Administrator) and Dr. Magdalene Muthoka (former Chief Manager, HR New KCC), received bribes from ICT Health (based in Jakarta, Indonesia). It is claimed that the CEO has used the money to build residential flats in Riat, Kisumu County. Curiously, a contractor by the name EPCO who is doing construction work for the Nairobi Hospital is the one who built the flats for Nyamongo.

Our investigations have revealed that the Indonesian firm favored by the cartel is not the owner of the system but is just a reseller. The system is developed and owned by an Indian company in Cheney, India. ICT Health also does not have local representation, as purported. They gave the address of an office on Loita Street, which turned out to be a government office.

“The local contact person they gave, Mr. Mogaka, turned out to be an employee of TechMahindra, who were the consultants who drew the ToR for the RFP. They were not eligible to bid due to a conflict of interest,” said the source.

Dr. Meshack Onguti

He was previously named in our investigation earlier in the year as part of the face of corruption at the hospital. A Maxillofacial Surgeon who has currently changed profession to “assist” The Nairobi Hospital CEO. Previously himself held a CEO’s position at the Kenyatta National Hospital, but Kenya Insights is not going into those details now. It has since been discovered, that he has no clinical duties in The Nairobi Hospital, but wakes up early and reports to the CEOs office. Some people think he is the personal assistant (PA) to the CEO, while others say he is Deputy CEO, but then others claim he is the butler to the CEO. Whatever the case, his existence in the hospital rotates around the CEO and the CEO’s office. At tea time, he is stationed at The Nairobi Hospital’s doctors lounge to collect information, then goes back to his station in the CEOs office. He waylays doctors along the corridors and takes them to the CEOs office to be converted by coercion or conviction to support the CEO. He also walks around with confidential hospital documents in his inner pocket and shows to doctors in response to new allegations, but all in the aim of promoting the CEO. It is also understood that he sometimes goes to particular members of the hospital’s senior management to threaten those perceived not subservient to the CEO. It’s not clear how he is paid for these services, but he is fully occupied doing what he does at the Nairobi Hospital, and he seems quite comfortable, so the rest is left to imagination.

The Kenya Hospital Association (KHA) Board of Directors

About 3000 Kenyans are members of the Kenya Hospital Association. This is a loose body that apparently owns the hospital. The articles of this association are so weak, that cunning people easily get into the board and take advantage of the hospital. There is no background check on who joins, so it’s easy for the vultures to be recruited to get in, and once in are very difficult to remove.

It is understood that those who join boards, are those with something to give back to society by service or lending expertise. And even now, in the KHA Board there are such directors, those board members determined to grow the hospital. But currently, they are overpowered by those with conflicting interests. These vultures are those looking for employment and opportunities to exploit anything for their personal gain. The chairman sets the example by way of his/her conduct of the board matters. It will be difficult for wayward board members to find traction or survive if the chair follows the laid down regulations in conducting board business.

The most striking thing the board has done lately to the amazement of all ASA Members, how it has remained very quiet through the month of April and May as ASA Members are persecuted by the CEO. It’s very telling that the CEO was probably acting on unwritten instructions sanctioned up there.

The board’s unholy alliance with the CEO, and MAC Chairman, Dr. Fred Kambuni has put the hospital in a self-destructive trajectory. At least half of the board members have conflict of interest as is indicated by: –

1. Involvement in hiring own people (Cronyism).
2. Interference with or influence of tenders and procurement to favor their companies or those they have a working relationship with. This includes creating unnecessary court cases and procuring lawyers to defend obvious wrongs.
3. Having own companies and relatives or friends who must do business in the hospital and with the hospital.
4. Influencing how much is paid out for what to who. This includes contracts and salaries, and also irregular pensions.
5. Influencing the membership for purposes of soliciting votes to stay in the board. Recent reports indicate that two members alone recruited about 50 and 100 new KHA members respectively. The articles of association do not allow any one member to recruit more than 5 new members at a time.
6. Influencing the virtual voting system to favor them and their preferred and chosen board members. The virtual voting system was introduced temporarily during the Covid and has been widely abused at the KHA elections in the last four to five years.

Looking at the facts, one begins to understand why there is so much interest from people of questionable characters gunning for the board of directorship at the Nairobi Hospital. The systems are weak in this multibillion shilling turnover hospital, so there are billions to be allocated for personal gain if one plays their cards right.

The Rift between ASA, MAC, BOARD, CEO, and CHAIRMAN

Our investigations have also revealed the deep rift in the hospital between The Admitting Staff Association (ASA) on one side and The Medical Advisory Committee, previously chaired by Dr. Fred Kambuni, The CEO, Mr. James Nyamongo and the board  chairman, Mr. Chris Bichage on the opposite side.

Let us explain what the Medical Advisory Committee (MAC) is. The Admitting Staff Association(ASA) is comprised of the doctors practicing at The Nairobi Hospital, and are represented at the Board of Management, by the Chairman and Vice Chairman of the MAC. The MAC is made up of doctors who chair the various departments involved in the care of patients. The MAC is therefore, is the voice of the doctors and nurses, providing direction to the board and hospital management in achieving the highest standards of medical care. MAC advice comes from ASA, and will be implemented by the board and the hospital administration as much as resources allow. This is given that the ASA and the nurses are the engine of the hospital and generate approximately 99% of the hospital revenue.

When MAC does not convey ASA needs, then the quality of health care suffers. The Vice Chairperson of MAC resigned recently in protest, because she realized the board wasn’t taking the MAC advice, and therefore ASA issues were not on the table.  She received morbid threats for exposing the failures in MAC

The previous MAC Chairman, Dr. Fred Kambuni, who was elected about six to seven months ago, had gone into an unholy alliance with the Board Chairman, Dr. Chris Bichage and the CEO, Mr. James Nyamongo to subvert ASA issue and take over the role of MAC for their own personal interests. ASA members have accused MAC of not representing the doctors’ interests. The ASA, therefore called for a Special General Meeting and recalled the MAC on the 25th April 2024. The CEO then on 29th April 2024 suspended and sued the ASA members who flagged integrity issues in the hospital for alleged sabotage. It is important to note that a CEO has no powers to suspend a doctor. There are mechanisms for such action, and the CEO only implements the board direction. That recommendation to discipline a doctor is taken by standards and ethics committee to the board after a hearing. All this did not happen.

Sequence of events that irked the CEO

The ASA members held a so-called ‘Kamukunji’ meeting on February 15th, 2024, to discuss issues affecting the hospital’s management and governance. However, unknown to the ASA Members, the then MAC Chairman, Dr. Fred Kambuni had invited the management and the board, including the CEO, Board Chairman, Company Secretary, and hospital lawyers. Instead of the ASA discussing their issues, they were forced to listed to the board, management and their lawyers, obviously amazed at how their meeting had been hijacked.

On March 21st, 2024, the ASA called for a SGM to discuss the hospital’s management and governance. The then MAC Chairman, Dr. Fred Kambuni tried unsuccessfully to stop the meeting unsuccessfully. At this point it became very clear to ASA members that Dr. Fred Kambuni and his committee were ASA’s greatest obstacle to improved health care. A decision for their recall was made after that event.

On April 8th, 2024, a requisition for an SGM to recall the MAC was delivered to the ASA Secretary’s office. Incidentally the secretary to ASA happens to be the CEO. It was obvious to the members that the CEO was going to obstruct the MAC recall in every way, and this he tried, to the last minute.  

This was the Announcement:

A Special General Meeting of the Admitting Staff to Recall The MAC on the 25th April 2024

The Agenda: –



1. The MAC doesn’t articulate issues of the ASA at the board and management.
2. The MAC doesn’t vote for ASA, but to the wishes of management and board.
3. The MAC is not concerned about the deteriorating clinical services and patient care.
4. The MAC sabotages all ASA meetings intended to discuss issues of the hospital.

The recall was done successfully on 25th April, 2024 and Dr. Edwin Rono elected Chairman of MAC, and Dr. Agnes Gachoki as Vice Chairperson. For that, the CEO suspended ten members of admitting staff on 20th April 2024, and sued them in court, personally signing the affidavit as the CEO, without directions from the hospital’s Standards and Ethics Committee or the board.

The articles of association state that a minimum of 25 ASA members with one clear agenda are required to call for an SGM, and two-thirds of the members voting for the agenda is all that is required to pass the resolution on the agenda.

On May 6th, 2024, a court order was issued against 10 officials of ASA. The CEO signed the affidavit, suggesting that he was in an all-out war to stifle any dissenting voices from ASA members.

The court case has opened a Pandora’s box of grave mismanagement facts that will shock many. Hearing is on the 4th June 2024, where the CEO will be cross examined on his conduct on procedures used to suspend the doctors and his roguish way of carrying out his duties.

In our investigation, we learnt that he also filed allegations at the DCI offices claiming that some five doctors were planning to kill him. The doctors were summoned by the DCI offices to record statements and are under investigation. Our efforts to interview the doctors involved were however unsuccessful by the time of publication.

This is Part 1 of our series of in-depth investigations, which has taken us into the hospital’s deepest corridors and dug out the underlying murky structures that will shock many.


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