Challenges

Nepali citizens and communities have remained incredibly strong in the face of change, and their health systems are no exception. Nepal has rebuilt health and social systems as well as physical infrastructure after the earthquake in 2015. It has also maintained or improved progress on key indicators in maternal and child health. Continued political change throughout the years following 2015 also presented new challenges. Moreover, globally, the COVID-19 pandemic in 2020 impacted lives, livelihoods, and the social systems in which people live. Moving forward, opportunities remain for improvement in maternal and neonatal health in Nepal. Addressing health system financing and reducing out-of-pocket costs will be crucial to deliver health care to the whole population. Improving human resources for health and reducing inequalities will further contribute to strengthening the health system for mothers and their newborns.

Rebuilding from the 2015 earthquake

On April 25, 2015, Nepal experienced an earthquake of magnitude 7.8.¹ The earthquake damaged infrastructure in 32 districts, especially the Western and Central development regions and in Kathmandu. Its impacts were severe and far-reaching, with a death toll of 9,000; 22,000 people injured; 2.8 million people displaced; and an estimated economic loss of US$9 billion.² Over 1,200 health facilities were destroyed or damaged, with some districts losing up to 90% of their health facilities.²

The country demonstrated incredible resilience in the face of the natural disaster, with communities using their resources, knowledge, and skills to rebuild their lives.³ Strong community engagement enabled the reestablishment of health services, which had ramifications that extended to other social services beyond health.² With support from external aid, Nepal rebuilt earthquake-resilient infrastructure: 800,000 homes, 7,000 schools, over 750 health facilities, and over 650 government buildings.⁴

Reconstruction from the devastating earthquake necessitated the creation of stronger, more resilient health and social systems in Nepal, as well as a shift to improving disaster preparedness and management in the face of future challenges. Six years after the earthquake, 92% of the targeted population was on schedule to move into refurbished resilient houses.⁵ However, Nepal will need to continue to improve infrastructure as well as disaster preparedness strategies given the widespread nature of the damage and the potential for future quakes.^6,7 Nepal’s ability to maintain and accelerate progress in many health indicators since 2015 speaks to the strength of its citizens and communities. This will enable the nation to continue to build.

Health system financing

Nepal has achieved significant gains in maternal and child health without substantial public increases in spending; however, the nation is facing pressure on health care spending in multiple aspects. Figure 40 shows the breakdown of health care spending in Nepal.

From 2000 to 2020, health expenditure per capita increased from US$8.3 to US$58.3, a sevenfold increase. Total health expenditure as a percentage of gross domestic product rose from 3.13% to 5.17% in this same period.^8,9 However, Nepal’s government spends a smaller proportion of their budget on health relative to other countries, and this value has not changed greatly in the past 20 years. In 2017, approximately 5% of Nepal’s public budget was allocated toward health, compared with a Southeast Asian regional average of 8%.¹⁰

Additionally, external financing as a proportion of overall health care spend has been decreasing since the early 2000s, when it represented about 20% of spending. Today, donor financing is 11% of the health care budget; decreases in donor aid mean that the nation must develop reliable financing sources from domestic areas.

Nepal launched a broad fee removal program in 2007 and an expanded National Health Insurance Program (NHIP) in 2017. However, the NHIP is being implemented gradually and has yet to reach most of the population: only 21.4% enrollment had been achieved by July 2022, and dropout rates remain high.^11,12,13 Enrollment in health insurance is more likely for households that are wealthier or have higher levels of education, suggesting that the program may not be reaching the citizens who need it most.¹⁴ Nepal is also adjusting its financing mechanisms as it transitions to a system where local governments finance a greater proportion of health care.11 Other types of health insurance are growing in the country; these represented 14% of current health expenditure in 2016, but they are still not widespread.¹¹

Out-of-pocket spending remains a substantial proportion of overall health care spending in Nepal at 56% of current health expenditure, even though programs such as the Safe Motherhood Program and Free Health Care program have been successful at expanding financial protection for MNCH services.^11,15 Out-of-pocket spending has fluctuated between 42% and 67% in the past two decades but did not decrease greatly from 2000 to 2020.¹⁶ An analysis leveraging the 2010 to 2011 Nepal Living Standards Survey suggests that catastrophic health expenditure rates due to overall out-of-pocket costs are high, with an estimated 10.3% of Nepali households experiencing catastrophic health expenditure per month at a threshold of 40% of household income.¹⁷ This share is higher for households in the poorest quintile and households in the Far-Western development region, an area with more rural and mountainous territory.¹⁷ People in certain occupations, such as informal jobs and agricultural work, are also more prone to high out-of-pocket payments and impoverishment due to health expenditure.¹⁸

Though Nepal has a positive macroeconomic outlook, Nepali health policymakers have a few milestones upcoming on the road to sustainable health financing, including costing a national unified basic health care package, defining mechanisms for pooling funds, and implementing health care budgeting at the provincial and local government levels.¹¹ Nepal will continue to improve health financing and work through these challenges over the coming decades.

Human resources for health

Nepal has intentionally developed health policies to improve the skills and number of qualified health professionals, as discussed in the What did Nepal Do? Section and the How did Nepal implement? section. However, challenges remain in human resource distribution across the country. There are significant gaps in attracting and retaining health professionals, especially in rural areas and the mountain ecological zone, such as parts of Karnali and Sudurpashchim provinces.¹⁹ The mix of health care providers leans toward nurses/midwives. In rural areas, female community health volunteers are often the primary point of contact with the health system. This can result in limited access to higher levels of care for more complicated maternal and neonatal health issues. Other provinces also face disparities, such as Madhesh, one of the densest provinces at 630 people per square kilometer, which receives the lowest health funding per capita.²⁰ Doctors and nurses are concentrated in the terai ecological zone and in the Kathmandu Valley, where there are more large hospitals.²¹

The FCHV program also faces several challenges. Starting in the 2010s, FCHVs have been advocating for an updated system of renumeration, incentives, and payment.²² Many of the current volunteers are also aging, creating a need to recruit, train, and retain younger women to maintain the size of the network. The role of FCHVs in Nepal will continue to shift in the future as both health system governance and disease epidemiology change.

Lingering inequalities

Despite Nepal’s progress in maternal, neonatal, and child health indicators, prominent inequalities by geography and wealth quintiles remain. Mountain ecological zones—such as the northern parts of Karmali, Sudurpashchim, and Gandaki—have longer travel times to health facilities compared with hill and terai ecological zones.²³ In the mountain ecological zone, only 17% of the population can reach health facilities in under an hour, whereas 42% and 44% of the population in hill and terai ecological zones, respectively, can reach a facility in this time.¹¹ There also are fewer comprehensive emergency obstetric and newborn care (CEmONC) facilities outside of urban, high-density areas, contributing to greater geographic inequalities, especially in comprehensive maternity care. Only about 64% of the population can access a secondary facility in under 30 minutes with a motorized form of transport.²³

Coverage gaps between the wealthiest and poorest quintiles in 2022 for antenatal care, maternal postnatal care, and neonatal postnatal care were 18.1%, 16.5%, and 4.6%, respectively, likely because these services can be delivered at lower-level health facilities; four antenatal care visits are also paired with monetary incentives for the attending woman. Coverage gaps in 2022 between the wealthiest and poorest quintiles for institutional delivery and C-section services were higher, at 31.8% and 32.4%, respectively. In 2022, women in the wealthiest quintile had 31.4% of births in a private facility, compared with 6.9% of women in the lowest wealth quintile; ability to afford private facilities expands options for delivery and thus access to more complex obstetric procedures. Women in rural areas in all provinces had lower C-section rates than those in urban areas in 2022, often because of longer travel distances to a basic emergency obstetric and newborn care (BEmONC) or higher-level facility.²³

As highlighted earlier in the discussion of the integrated maternal, neonatal, and stillbirth mortality transition framework, reducing inequalities is expected to be a key next step for Nepal as the country continues to advance toward phase IV of that framework.