Abstract:
Health is one of socio-economic components of delivering the vision’s 2030 Social pillar.
However, it remains a global challenge and an impediment to the human capital growth and
development. The sector is credited with the robust role it plays in ensuring healthy and skilled
workforce capable of driving the economy and meeting global commitments for health such as
the Abuja and Maputo Declarations. To this end, the sector contributes an average of 6% to the
GDP. Therefore, the realization of fundamental rights to health and the contribution to economic
development as enshrined in the vision 2030 is anchored on the development and sustainability of
comprehensive investment in health systems. In Kenya, private hospitals provide over 47% of the
healthcare services to the general population of over 53.8 million people in Kenya. This is an
indicator of a strong yardstick in which the economic growth and prowess of a nation can be
assessed. Despite the importance of hospitals in provision of health, their sustainability has been
at risk. This has a major ramification on the smooth provision of health services to Kenyans, and
the implementation of the Kenya Health Policy 2014-2030. Effective financing practices play a
great role in safeguarding sustainability of private hospitals thus ensuring business continuity.
Through a balanced scorecard analysis, this study evaluated how business sustainability was
influenced by the financing practices of private hospitals in Nairobi County, Kenya. This study
adopted positivism research philosophy and a descriptive research design. The study involved 68
private hospitals located in Nairobi, as advised by the 2019 Kenya Medical Practitioners and
Dentist Board retention register. A closed ended questionnaire was employed in collecting
primary data. A bivariate linear regression was used for inferential analysis after testing the data
for normality, independence. The study established a strong, positive, and statistically significant
relationship between financing practices and the sustainability of private hospitals in Nairobi.
The study recommended that private hospitals should continuously build the capacity of the
financing function by pooling of resources to increase efficiency in utilization of health resources
as it has a significant relationship with sustainability of hospitals. In addition, they should
consider borrowing assets in cases of financial crisis as a sustainability safeguard. Such
practices will not only aid in developing and strengthening healthcare financing but also in
reviewing of the criteria for resource allocation and utilization. Hospitals should also
continuously establish good working relationships with their suppliers and service providers to
enable them access necessities on credit in case of financial crisis. This will not only ensure
success of the private hospitals but also in the reinforcement of the sustainability potential. In
addition, hospitals should consider lease of assets to boost the financing of the hospital
operations as a way of improving on the cash inflows.