The Social Health Authority (SHA) has shut all its sub-county and regional branches, including seven offices in Nairobi.
The offices were inherited from the defunct National Health Insurance Fund (NHIF).
Sources say the closures have left staff in limbo, with some redirected to county offices or the Nairobi headquarters, while others remain at home.
Regional offices have also been shut, with managers redeployed and reassigned duties at the head office. "Some staff report to county offices, but we do not have designated roles.