Nepal is grappling with significant challenges in its pursuit of universal health coverage, despite pivotal steps such as transitioning to federalism and initiating the National Health Insurance Program (NHIP). Recent analyses reveal that persistent structural mismatches between health financing policies and purchasing practices are diminishing the effectiveness of these ambitious reforms.
Challenges in Health Financing Alignment
The concept of strategic purchasing holds promise for enhancing the efficiency, equity, and responsiveness of Nepal’s health system. By directing pooled funds based on the specific needs of the population, the performance of healthcare providers, and the value of services, strategic purchasing can drive significant improvements. However, Nepal’s progress is hindered by outdated practices like line-item budgeting and fragmented funding streams, which disrupt the seamless adoption of strategic purchasing methodologies.
Institutional Barriers and Policy Overlaps
Complicating matters further, the Ministry of Health and Population in Nepal simultaneously functions as a policymaker, purchaser, and provider. This multifaceted role dilutes accountability and reduces the autonomy necessary for effective purchasing strategies. Additionally, public healthcare providers receive funding from both traditional budgets and reimbursement schemes, leading to weakened performance incentives. The absence of health technology assessments and cost-effectiveness analyses in the NHIP’s purchasing decisions raises questions about the efficient allocation of resources within the benefit package.
• Legacy budgeting systems continue to impede modern financial practices.
• Overlapping roles within the Ministry reduce clear accountability.
• Dual funding streams for providers dilute performance incentives.
• Lack of strategic assessments affects the efficiency of fund allocation.
Addressing these issues requires a comprehensive institutional realignment. Clearly defining roles within the health financing architecture and establishing robust contractual mechanisms are crucial steps toward integrating strategic purchasing into Nepal’s system. Learning from both national experiences and international best practices can bridge the existing systemic gaps.
Reforming Nepal’s health financing framework is not just a bureaucratic necessity but a strategic imperative to ensure that public resources are utilized effectively. By fostering a more transparent and accountable system, Nepal can enhance the quality and equity of healthcare services, aligning them with the overarching goals of federalism and universal health coverage. Implementing these changes will be pivotal in overcoming the structural barriers currently undermining the success of the NHIP and the nation’s broader health objectives.
This article has been prepared with the assistance of AI and reviewed by an editor. For more details, please refer to our Terms and Conditions. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author.
