Hospitals across Nepal have not received payments exceeding Rs 15 billion from the government for treating insured patients, despite making repeated claims. The government has failed to release the funds due to insufficient resources in the Health Insurance Fund and delays in processing claims.
According to Bikesh Malla, Public Health Officer at the Health Insurance Board, no payments have been made to hospitals since mid-July. “The fund lacks sufficient money. We managed to settle payments for the previous fiscal year, but none for the current year. Additionally, the shortage of staff to process claims has worsened the situation. The claims review committee, comprising 25 members, including doctors and nurses, receives 30,000–40,000 claims daily, making timely processing challenging,” he stated.
With delays in reimbursement, some hospitals are considering suspending the insurance programme backed by the government. In this context, Health Minister Pradeep Paudel made a controversial remark last week, stating that the government cannot clear the dues.
"There will be no payments—it is simply not possible. How much had the state committed? Rs 7.5 billion? How much has been spent already? The previous year’s dues cannot be cleared from this year’s budget. Rs 16 billion is a pending liability. Since I took office, we have already utilised the allocated funds," Minister Paudel said.
He further criticised hospitals for overspending insurance funds on unnecessary medicines, making it difficult to sustain the programme. “This year, the cost will reach Rs 40 billion. Can I clear these dues simply by making empty promises? The allocated Rs 7.5 billion is already exhausted, and the Ministry of Finance has instructed us to cut 25% of the budget. While we cannot officially terminate the programme, it will collapse on its own if it becomes unsustainable,” he remarked.
The government allocates Rs 7.5 billion annually to the Health Insurance Board, while contributions from insured individuals generate Rs 3–4 billion. However, the board’s records indicate that over Rs 13 billion is required annually for health insurance expenses, with most funds being used to clear previous dues.
Minister Paudel’s remarks sparked an uproar in Parliament on Monday. Rastriya Swatantra Party MP and former State Minister for Health, Toshima Karki, strongly criticised the minister, questioning his integrity. “It is shameful that a minister who promised to raise the insurance coverage limit to Rs 500,000 is now saying payments cannot be made due to a lack of funds. If he lacks solutions, he should step aside,” she stated.
Karki further argued that if the programme was implemented nationwide, it could generate Rs 20 billion annually, ensuring healthcare for all. “It is disheartening to see the minister making irresponsible statements. The government had once taken credit for launching this programme. Now, after years of neglect, they are abandoning it. If he lacks proper advisors or data analysis, he should step down—we are ready to provide guidance,” she added, calling for mandatory health insurance for all.
In response, Minister Paudel defended his statement in the House of Representatives, saying, “The goal is not to scrap health insurance but to regulate and improve it. The ministry is working towards restructuring the system.”
Nepal introduced the Health Insurance Programme in 2015, and as of now, 8.4 million citizens are enrolled. Former Director-General of the Department of Health Services, Dr. Sushilnath Pyakurel, believes that implementing the recommendations of the Health Insurance Reform Task Force could resolve the ongoing crisis. “If managed properly, health insurance can ensure treatment for all,” he stated.
