Nepal has one of the highest proportions of out of pocket expenditures on health and one-quarter of the people is living below the poverty line. In recent time, there is some increase in the health budget, but the country still relies on development partners. The endorsement of the national health insurance bill has enabled the government to establish the national health insurance scheme through the development of adequate policies, strategies, and mechanisms for implementation at the national and federal level. The scheme has many challenges to address governance and leadership, financing, information, health services, workforce, and essential medicines and technologies. Therefore, it is imperative to establish a robust mechanism like a “tree”, which has strong roots of building blocks of health systems, which produces fruits that ensure improved responsiveness, efficiency and equity and financial protection. It is necessary to learn and apply from the experiences of other countries while implementing the national health insurance scheme.