Retirement Benefits Authority CEO Nzomo Mutuku. PHOTO | SALATON NJAU
Retirees will have access to better healthcare in hospitals of
their choice for chronic, pre-existing and high-risk conditions once the
Post-Retirement Medical Fund (PRMF) is gazetted.
Retirement
Benefits Authority (RBA) chief executive Nzomo Mutuku said the draft
guidelines for PRMF have already gone through a stakeholder consultation
process and subsequently approved by the Attorney-General and the
Treasury. It is now awaiting gazettement.
Speaking
during the launch of Liaison Group’s Suluhu Umbrella Scheme in Nairobi,
Mr Mutuku said the guidelines mean the stage is now set for employers to
plan for the benefits of employees.
“It also means retirees will be better prepared to comfortably
meet their healthcare needs and access hospitals of their choice for
chronic, pre-existing and high-risk conditions,” said Mr Mutuku.
PRMF is entrenched within a registered retirement benefits scheme or by an employer (sponsor).
Contributions
are made while a member is in active employment. Medical cover benefits
are met after a member has exited the service of the employer and
becomes entitled to receive benefits as provided by the scheme rules.
“Just
the same way a pension scheme provides assurance of an income upon
retirement, the proposed PRMF will ensure provision of healthcare upon
retirement,” said Mr Mutuku.
The Retirement Benefits Act was amended in 2016 to specifically provide for the establishment of the PRMF.
Thereafter, the RBA commenced a consultative process to develop
guidelines to govern the PRMF. The guidelines intended to regulate and
supervise the establishment and management of PRMFs, provide a guidance
for schemes and post-retirement medical funds to allow members and or
sponsors to make additional voluntary contributions.
In
this year’s budget, the Treasury announced that the PRMF will be
exempted from the retirement benefits levy in order to boost members’
contributions.
Data shows that 60 per cent of an
individual’s medical costs are incurred in retirement, with the
percentage of admissions for people over 65 years reported to have
increased to 34 per cent in 2013 from 25 per cent a decade earlier.
Due
to higher risk, older people have had to pay high premiums to get
medical insurance with some service providers not offering medical cover
to people aged above 65.
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