From Insurance Crisis to Health Financing Reform: Rethinking Nepal’s Path to Universal Health Coverage

Abstract

Publishing Process

Received Revised version I: 2^nd  April, 2026

Finalized to publish: 5^th July 25, 2026

Open Access 4.0        

 Published date: 10 .July  2026    Vol:5 Issue 4 -A1

Abstract[1]

Nepal’s National Health Insurance Program (NHIP) aims to advance Universal Health Coverage (UHC), but it faces a severe fiscal and operational crisis. Low premiums relative to service costs, fragmented risk pools, overlapping schemes, and political influence, such as hospitals owned by politicians to boost public support, threaten sustainability. Voluntary enrollment in a predominantly informal economy, coupled with rising misuse of insurance due to low awareness of responsible utilization, further strains resources. Strategic reforms are needed: hybrid financing combining contributions and tax-based funding, strategic purchasing tied to outcomes, federal-provincial coordination, primary health care as the anchor, and continuous health literacy campaigns. Fiscal innovations such as VAT-backed funding and preventive programs, including national supplementation schemes, can improve efficiency and equity. This paper argues that only by addressing structural, financial, operational, and behavioral challenges together can Nepal achieve a resilient, equitable, and sustainable health system for its emerging generation.

Keywords:
Nepal, Health Insurance, UHC, Public Health, Financing