Teaching Hospital Health Insurance Service Halt
13th January 2026, Kathmandu
The decision regarding the Teaching Hospital health insurance service halt has raised serious concerns about the sustainability of Nepal’s national health insurance program. Tribhuvan University Teaching Hospital, commonly known as TUTH, has officially decided to discontinue all health insurance-related services starting from Magh 1, 2082 (January 15, 2026). This critical decision was taken after prolonged financial strain caused by unpaid claims from the Health Insurance Board (HIB), threatening the operational capacity of the country’s premier public medical institution.
Teaching Hospital Health Insurance
According to hospital administration, the Health Insurance Board has failed to clear insurance claims amounting to nearly NPR 40 crore (400 million). This prolonged delay in reimbursement has severely affected the hospital’s financial stability. Despite continuing to provide services under the health insurance scheme for the past two years using internal resources, the hospital stated that it is no longer in a position to sustain the losses, which reportedly reach approximately NPR 20 million every month.
Financial Discrepancies and Structural Issues
The Teaching Hospital health insurance service halt highlights a deeper structural issue within Nepal’s health insurance system. Hospital officials revealed that while the institution spends more than NPR 5 crore (50 million) every month to provide treatment under the insurance scheme, only around 50 percent of the claimed amount is approved by the board. This massive discrepancy between actual treatment costs and approved reimbursement has steadily pushed the hospital toward financial distress.
Information Officer Dr. Gopal Sedhai and Spokesperson Kaliprasad Rosyara explained that due to the lack of timely payments, the hospital has been forced to operate at a deficit for an extended period. The administration stated that they have not been able to pay medicine and medical supply vendors for the past five months. This has directly affected procurement, inventory management, and the hospital’s overall ability to deliver uninterrupted healthcare services to the general public.
A Nationwide Challenge for Health Institutions
The Teaching Hospital health insurance service halt is not an isolated incident. It reflects a nationwide challenge faced by health institutions enrolled under the government health insurance program. The Health Insurance Board itself has acknowledged that it owes more than NPR 10.5 billion to over 500 listed health institutions across the country. In late 2025, the Board reported that its allocated budget of NPR 10 billion for the fiscal year 2025/26 was already exhausted in clearing old dues, leaving a significant cash crunch for current liabilities.
Many other hospitals, including the Rapti Institute of Health Sciences, have also warned of similar service suspensions. The Health Insurance Board attributes these delays to a “funding crunch” rather than intentional negligence, noting that the demand for services from over 10 million enrolled citizens far exceeds the current government subsidies and premium collections.
Impact on Patients and Public Healthcare
From the patient perspective, the Teaching Hospital health insurance service halt will directly impact thousands of insured citizens who rely on the facility for specialized and affordable healthcare. As the largest government hospital in Nepal, TUTH serves as a primary referral center. Its withdrawal from the insurance program could leave low-income families without access to essential medical services, forcing them to seek costly private care or delay life-saving treatments altogether.
The situation is further complicated by the mismatch between treatment rate structures set by the Board and the hospital’s actual service costs. Hospital administration noted that despite repeated appeals for the last two years to consider the hospital’s rates as final, no effective adjustments were made.
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Policy Warnings and the Need for Reform
Policy experts warn that if immediate corrective measures are not taken, the national health insurance program itself could face collapse. Health Minister Pradeep Paudel has recently expressed concerns that the program is on the verge of becoming inoperative due to the lack of adequate resources. While the government has proposed popular measures, such as increasing the sum insured to NPR 500,000, the underlying funding mechanism remains fragile.
To protect both healthcare institutions and insured citizens, experts suggest several systemic reforms:
Integrating fragmented health services from the Social Security Fund and Employees Provident Fund.
Implementing a mandatory 2 percent salary deduction for formal sector employees to strengthen the funding base.
Automating the claim settlement process to reduce the 20 percent rejection rate caused by technical errors.
Reforming the Health Insurance Board to ensure it operates with financial autonomy and good governance.
Conclusion
The Teaching Hospital health insurance service halt serves as a critical warning for policymakers and stakeholders in 2026. Without timely reimbursement, realistic treatment rates, and sufficient government funding, Nepal’s health insurance program risks becoming unsustainable. The decision by TUTH underscores the urgent need for systemic reform to protect the viability of the national health insurance scheme. Immediate intervention is necessary to prevent further service disruptions and ensure that the promise of universal health coverage in Nepal does not remain unfulfilled.
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