Health Insurance in Pakistan: Challenges, Opportunities, and the Road Ahead

Introduction

Healthcare is a basic human right, yet millions of people around the world still lack access to affordable and quality medical services. In Pakistan, where more than 240 million people live, the majority still rely on out-of-pocket expenses for healthcare. This makes medical treatment a heavy financial burden, especially for middle and low-income families. Health insurance is one of the most effective ways to reduce this burden and ensure that people receive the medical care they need without falling into poverty. Over the past decade, Pakistan has made progress in expanding health insurance coverage through both public and private initiatives, but many challenges remain.

What is Health Insurance?

Health insurance is a financial arrangement where individuals or families pay a premium to an insurance provider, and in return, the insurer covers some or all of the medical costs when the insured person requires healthcare. This can include hospitalization, surgeries, medications, maternity care, and in some cases, outpatient visits. The main purpose is to protect individuals from high medical costs that could otherwise drain their savings or push them into debt.

The Current State of Healthcare in Pakistan

Pakistan spends around 3% of its Gross Domestic Product (GDP) on healthcare, which is low compared to many other countries. Public hospitals often struggle with limited resources, overcrowding, and insufficient medical staff, while private hospitals offer better facilities but charge high fees. Because of this imbalance, most people either avoid treatment until it becomes urgent or sell assets and borrow money to afford medical care.

According to reports, more than 60% of healthcare spending in Pakistan is paid directly out-of-pocket by patients. This highlights the urgent need for a strong and accessible health insurance system.

Government Initiatives: Sehat Sahulat Program

To address these issues, the government of Pakistan launched the Sehat Sahulat Program (SSP). This is a national health insurance initiative aimed at providing free healthcare coverage to underprivileged families. Eligible households are given a health card, which can be used at selected public and private hospitals for cashless treatment.

Key features of the Sehat Sahulat Program include:

• Coverage of major illnesses such as cancer, kidney dialysis, heart diseases, and maternity care.

• Access to both public and private hospitals in the panel list.

• No upfront cost for patients, as hospitals are reimbursed directly by the government.

This program has been a game-changer for many poor families, enabling them to receive expensive treatments that would have been impossible otherwise. However, due to political and financial challenges, its implementation has been inconsistent in some provinces.

Private Health Insurance in Pakistan

In addition to government programs, private health insurance companies play a significant role in Pakistan. Several local and international insurance providers offer health plans for individuals, families, and corporate employees. These plans vary in terms of coverage, hospital networks, premium costs, and benefits.

Some well-known private health insurance providers in Pakistan include:

• Jubilee Life Insurance

• Adamjee Insurance

• EFU Life Insurance

• State Life Insurance Corporation

• Allianz EFU

Private health insurance is more popular among the urban middle and upper classes as well as among employees of large companies that provide health insurance as part of their benefits package.

Benefits of Health Insurance

Health insurance brings multiple benefits, both at the individual and national level:

1. Financial Protection – It prevents families from falling into poverty due to sudden medical expenses.

2. Access to Quality Healthcare – Insured patients are more likely to seek timely treatment in good hospitals.

3. Encouragement of Preventive Care – Some plans cover regular checkups, helping detect diseases early.

4. Reduced Burden on Public Hospitals – By sharing the load with private hospitals, insurance ensures better patient care.

5. Peace of Mind – Families feel secure knowing that healthcare expenses are covered.

Challenges Facing Health Insurance in Pakistan

Despite progress, health insurance in Pakistan faces several obstacles:

1. Low Awareness – Many people, especially in rural areas, are unaware of health insurance or do not understand how it works.

2. Affordability – For low-income households, even small premiums may feel unaffordable.

3. Limited Coverage – Many private plans exclude pre-existing conditions or have limited hospital networks.

4. Trust Issues – Some people distrust insurance companies, fearing hidden charges or denied claims.

5. Infrastructure Gaps – In many parts of Pakistan, hospitals lack the capacity to provide insured treatments, especially in rural regions.

6. Policy Continuity – Political changes often disrupt government health programs, reducing long-term impact.

Opportunities for Growth

Although challenges exist, Pakistan has a great opportunity to strengthen its health insurance system:

• Digitalization: Mobile health apps and e-health services can simplify insurance registration, claim tracking, and awareness campaigns.

• Public-Private Partnerships: Collaboration between government and private insurers can expand coverage and reduce costs.

• Micro-Insurance Models: Affordable plans with small premiums designed for daily wage earners can increase coverage among the poor.

• Employer-Based Insurance Expansion: More companies could offer insurance as a mandatory employee benefit.

• Awareness Campaigns: Educating people about the importance of insurance can increase participation.

The Road Ahead

For Pakistan to achieve universal health coverage, it must address the challenges of affordability, awareness, and accessibility. The government should continue strengthening initiatives like the Sehat Sahulat Program, ensuring consistent funding and nationwide reach. At the same time, private insurers need to design flexible and affordable products for the middle and lower classes.

International organizations and development partners can also play a role by supporting Pakistan in building sustainable healthcare financing models. If implemented effectively, health insurance can significantly reduce poverty, improve public health, and enhance the quality of life for millions of Pakistanis.

Conclusion

Health insurance is not just a financial product; it is a lifeline that ensures dignity, security, and access to medical care. In Pakistan, where healthcare costs are rising and public hospitals are under immense pressure, health insurance offers a pathway toward more equitable and sustainable healthcare. While challenges remain, the growing awareness and expansion of both public and private insurance systems provide hope that one day, every citizen will have access to affordable and quality healthcare.

Health insurance in Pakistan is still in its developing stages, but with the right reforms, policies, and public participation, it has the potential to transform the healthcare landscape and bring Pakistan closer to the goal of universal health coverage.