Pakistan's first 100% state-funded health insurance

From Tandolaya to Atlanta: an unlikely insurance career

The episode opens with Muzamil asking his guest the question he puts to every visitor on Thought Behind Things — where did you grow up? Arshad Qaim Khani’s answer sets an unexpected tone. He was born in Tandolaya, a small city in Sindh that was once part of Hyderabad district and is now a district in its own right. He describes it as Pakistan’s most fertile agricultural belt — fertile enough that Field Marshal Ayub Khan personally flew there to request land for what would become the country’s first agriculture university. The locals refused. They considered their land too valuable to give away. The university was built nearby instead.

Khani grew up in that same stubborn, land-proud environment. He was the second of four siblings, educated entirely in Tandolaya through matriculation and then intermediate, which he completed locally when a college opened just in time. After inter, he sat an open competition run by State Life Corporation, which was sponsoring two fellowships to a top insurance institute in Atlanta. The competition drew university toppers and board position holders from across the country. Khani, by his own description a “desi” candidate from a small town, decided there was nothing to lose in trying. He was one of the two selected.

The fellowship was a distance-learning program equivalent to a PhD in life and health insurance, and he completed it in roughly two and a quarter years rather than the standard four. He then joined IBA Karachi for an MBA, finishing in 1999, before accepting an offer from American Life Insurance as country manager for underwriting — a move his friends warned against, given the security of a government pension. He went anyway, and spent the next two decades in senior roles across Pakistan’s private insurance sector.

The UAE detour that changed his frame of reference

Around 2005 or 2006, the Dubai government decided it wanted a mandatory health insurance system modelled on European standards. It needed advisers. Khani was approached and agreed to help. The experience gave him a close look at what a modern, functioning health insurance ecosystem looks like — one where you cannot drive a car off a showroom floor, open a business, or gain admission to an institution without insurance in place. He describes it as a society where insurance is not a product but infrastructure.

He returned to Pakistan with that frame of reference intact. He worked in the private insurance sector again, then moved through advisory roles in the Ministry of Commerce and the Ministry of Production, before the Sehat Sahulat Program crossed his path. The program was still in its infancy — it had started around 2016 in KBK (Kohistan, Bajaur, Kurram) and federal areas — and was looking for a senior director. Khani applied, went through a ten-month selection process, and eventually became its chief executive.

Why catastrophic health expenditure is the real poverty trap

Before explaining the mechanics of the program, Khani lays out the problem it was built to solve. He puts it plainly: the number one reason families fall below the poverty line, globally, is catastrophic health care expenditure. In a country where roughly ninety-nine percent of the population earns less than one hundred thousand rupees a month, a four-lakh-rupee medical emergency at two in the morning has only one answer — sell the house, sell the car, sell the livestock, sell the jewellery.

“Chaahe woh laut ke aa sake ya na aa sake, woh khaandaan agli chaar naslon tak khat-e-ghurbat se neeche gir jaata hai” — whether your loved one comes back from the hospital alive or not, that family falls below the poverty line for the next four generations.

This is the foundational logic of the Sehat Card. It is not primarily a health program. It is a poverty-prevention program that operates through health.

How the card actually works — and what it covers

Muzamil presses Khani on the mechanics early in the conversation, and the answer is more structured than most public communication about the program suggests.

The card is fully cashless. A patient presents their Sehat Card or national identity card at the hospital counter. If the treating doctor decides admission is necessary, the patient pays nothing from that point until discharge. The insurance company attached to the program pays the hospital directly. There are over 1,300 pre-priced treatment packages covering virtually every category of in-patient care. Hospitals are assessed against more than one thousand criteria by the Pakistan Healthcare Commission before being panelled, and then categorised by the Sehat Sahulat Program itself into five tiers — zero through four — with package rates incrementally adjusted by tier.

Khani gives bypass surgery as an example. A procedure that would cost several hundred thousand rupees out of pocket at a private hospital is covered in full under the card, at a negotiated rate that the program can sustain because it is, as Khani puts it, “the largest healthcare service purchaser in Pakistan.” The economies of scale allow quality care at rates no individual patient could negotiate.

Government hospitals as revenue centers, not cost centers

One of the more structurally interesting arguments Khani makes is about what the program does to public hospitals. Previously, a poor patient arriving at a government hospital was, from the hospital’s accounting perspective, a zero-cost unit — someone to be processed with minimal resource allocation. The Sehat Card changes that relationship entirely.

“Ab woh hospital ab transform ho rahe hain. Un aspataalon ko pata hai ke ab Muzamil sahab aaenge toh garib aadmi ban ke nahin aaenge. Now he will come to this hospital as a paying customer.”

When a patient arrives with a Sehat Card, the hospital receives a claim payment. That revenue can fund staff incentives, equipment upgrades, and infrastructure development. The program has, in effect, converted public hospitals from budget line items into businesses with a reason to compete on quality. Khani argues this is the mechanism by which the program will eventually improve service delivery — not through government mandates, but through market pressure applied at the point of care.

The dignity argument for universal coverage

Muzamil raises a pointed question about halfway through the conversation: why is the card universal? If someone can afford private health care, why should they be covered? Wouldn’t a means-tested, targeted approach — similar to the Ehsaas program — be more efficient?

Khani’s answer is partly philosophical and partly structural. He argues that universal coverage removes a specific kind of power dynamic that targeted programs cannot. He describes the experience of having to ask a wealthier relative or employer for money to pay a hospital bill — the lowered eyes, the performance of helplessness, the debt of gratitude that follows.

“Yeh itna bada contribution hai comedy sehat card ki ke usne sehat ke mamle mein insaanon ko, insaanon ki ghulami se — Allah ta’ala ki meherbani se — aazaad karwa diya hai.”

He also makes a structural point: means-testing at scale in Pakistan is operationally difficult, and the program’s universality is what gives it the purchasing volume to negotiate rates and sustain quality. A smaller, targeted pool would have less leverage with hospitals and less ability to enforce standards.

Fraud, accountability, and the 0800-09009 helpline

Muzamil does not let the conversation stay in the realm of aspiration. He asks directly about fraud — hospitals that join the panel for the marketing benefit and then demand cash from patients, or that game the claims system. Khani does not deflect. He acknowledges that fraud and abuse in health insurance programs globally runs at fifteen to twenty percent, and that the Sehat Sahulat Program is not an exception.

The program’s response operates on several levels. There is a 24-hour helpline — 0800-09009 — that patients can call from outside any hospital, at any hour, to report service denial, cash demands, or mistreatment. Complaints trigger a time-based escalation that moves from the hospital’s own management up through the insurance company, the program’s directors, the health minister, and in principle to the prime minister’s office. Discharged patients are called back to verify they actually received treatment and to ask whether anyone misbehaved. Hospitals that fail accountability checks are de-panelled; Khani says a dozen have been removed so far.

“We are imperfectly perfect,” he says. “We are on this learning curve, this expansion curve.”

Private investment following purchasing power into rural areas

The final structural argument Khani makes is about what happens to health infrastructure in remote areas once the card is in place. He frames it as a basic entrepreneurship logic: a businessman needs two things — a target customer base and purchasing power. The Sehat Card has placed purchasing power in the pockets of every Pakistani, including those in the most remote districts. That purchasing power will attract private hospital investment to areas that previously had none.

By the end of the conversation, Khani describes a proposal his team has made to the prime minister: a rural healthcare investment scheme that would pair the financial protection the card already provides with incentives for private investors to build quality facilities in underserved districts. He says the process has already begun in areas that were added to the program early, including FATA.

Muzamil asks Khani what Pakistan looks like thirty years from now. Khani’s answer is unambiguous: better health, better education, governance problems solved, social justice reasonably available, and a generation of innovative Pakistanis — “jugaadi” in the best sense — who have inherited a functioning state rather than a broken one. He describes the current generation of decision-makers as a transition generation, responsible for overhauling the plane and handing the controls to the next cohort in working order.

“Agar humne yeh nahin kiya toh phir shayad nayi nashl ke liye isko sambhalna aasaan nahin hoga.”