Kavita Singh, Director -Finance

1. National Health Mission (NHM) Kavita Singh, Director -Finance

2. Need of Investment in Public Health • Healthcare spending in India for 2014 is about 4.7% of its GDP. • Of this Government Health Expenditure (GHE) is 30%. A majority, 62% of healthcare expenditure is Household out of pocket (OOPE). • Nearly 55 million people getting impoverished on account of health care expenditure. • India ranks a low 175/188 in OOPE and 154/185 in terms of Public Health Expenditure out of Total Current Health Expenditure in 2015. • Increase health expenditure by Government as a percentage of GDP from the existing 1.15% to 2.5 % by 2025 (NHP 2017). Source: Health financing indicators for India 2014; Global Health Expenditure Data Base (GHED), World Health Organization

3. Health Policy -2017 • New Health Policy 2017 emphasizes the proposed Health Financing - • Increase health expenditure by Government as a percentage of GDP from the existing 1.1 5 % to 2.5 % by 2025. • Increase State sector health spending to > 8% of their budget by 2020. • Decrease in proportion of households facing catastrophic health expenditure from the current levels by 25%, by 2025. Source: New Health Policy 2017

5. Allocation –DoHFW Rs. in Crore # New Streams of Health Financing – Health & Education Cess - Existing 3% education Cess to be replaced by 4% health and education cess. Higher Education Funding Agency (HEFA) tobe restructured to fund infrastructure and research in medical Institutions. India Infrastructure Finance Corporation Limited (IIFCL) will be utilized to raise funds for Health Projects.

6. Department-wise Budget Estimate (Gross) 2018-19 Rs. in Crore

7. National Rural Health Mission (NRHM) launched on 12th April, 2005 • Strengthen hands of the State Governments in improving health care delivery by providing technical and financial support. • To bring greater focus on high focus States and rural population, particularly marginalized and vulnerable population. • Architectural correction through integration of vertical programmes, decentralization and communitization.

8. National Urban Health Mission (NUHM) launched on 1st May, 2013 • To strengthen the existing primary health care facilities and provide new facilities for the un-served population. • 1057 cities and towns covered. • Strengthening facilities in urban area in term of infrastructure, equipment and manpower.

9. National Health Mission - Vision “Attainment of Universal Access to Equitable, Affordable and Quality health care services, accountable and responsive to people’s needs, with effective inter-sectoral convergent action to address the wider social determinants of health”.

10. Flexible Pools under NHM NATIONAL HEALTH MISSION

11. ` 2 Sub-Missions NRHM NUHM Communicable Disease Pool • NRHM –Flexible pool- • RCH Pool • (II) Health System Strengthening • Pool • (i) Other Health System Strengthening • (ii) Comprehensive Primary Health Care • (iiI) ASHA Benefit Package including social benefits Health System Strengthening Comprehensive Primary Health Care Health System Strengthening- includes components -- NPCD, NOHP, Burns & Trauma, NPCF and other New Initiatives under NCD

12. NATIONAL HEALTH MISSION - COMPONENTS • RCH Flexipool- • RMNCH + A - Reproductive, Maternal, Neonatal, Child & Adolescent Health. • Immunization- Routine Immunization & Pulse Polio Immunization. • NIDDCP- National Iodine Deficiency Disorder Control Programme • Health System Strengthening – ASHAs, Human Resources including AYUSH, Mobile Medical Units, Referral Transport, Free Drugs & Free Diagnostics, Biomedical Equipment Management, Quality Assurance & Kayakalp, Infrastructure, etc. NRHM- RCH Pool National Urban Health Mission • To strengthen the existing primary health care facilities and provide new facilities for the un-served population in urban areas & urban poor. Major components Planning & Mapping, Programme Management, Training, Human Resources, Community process.

13. NATIONAL HEALTH MISSION - COMPONENTS • RNTCP – Civil Works, Laboratory materials for testing etc. • NVBDCP- Malaria, Dengue, AES etc. • NLEP- HR, Mobility support • IDSP- HR, Mobility support • NVHCP-National Viral Hepatitis Control Programme, Drugs Communicable Diseases Pool • National Prog. For Prevention & Control of Cancer, Diabetes, Cardiovascular Diseases & Stroke (NPCDCS) • National Prog. for Control of Blindness (NPCB). • National Mental Health Prog.(NMHP) • National Tobacco Control Prog. (NTCP) • National Prog. for Health Care of Elderly (NPHCE) Non Communicable Diseases Pool Infrastructure Maintenance • To meet salary requirement of Auxiliary Nurse Midwives (ANMs) and the Lady Health Visitors (LHVs) etc.  

14. Progress

15. Financial Progress under NHM

16. PLAN WISE ALLOCATION & RELEASE UNDER NHM (Rs. in crore)

17. Absorption capacity of States (Budget Vs Release) Rs.in crore

19. Need for Enhanced Allocation • Strengthening of Sub Health Centers as Health & Wellness Centers to provide comprehensive primary care. • Comprehensive Primary Health Care including screening of common NCD such as Hypertension, Diabetes, common Cancer. • Increasing number of PHCs and CHCs as per IPHS norms and up-scaling of existing initiatives e.g. strengthening facilities to IPHS • Up- scaling Free Drugs & Diagnostics Scheme.

20. Need for Enhanced Allocation • Need to eliminate TB and Measles • Strengthening of District Hospitals to provide multispecialty care & Training and e-Hospital Implementation • Universal Health Coverage (UHC) Pilots • Scaling up of new life saving vaccines • Budgetary provision for Diagnosis, Treatment and e-health initiatives • Strengthening of Drug regulatory system in the country

21. ALLOCATION FOR 2019-20 UNDER DIFFERENT POOLS OF NHM

22. ALLOCATION FOR 2019-20 UNDER NHM

23. ACTIVITY-WISE APPROVALS UNDER NRHM-RCH FLEXIBLE POOL 2018-19

24. ACTIVITY-WISEAPPROVALS UNDER NRHM-RCH FLEXIBLE POOL 2018-19

25. ACTIVITY-WISE APPROVALS UNDER HEALTH SYSTEM STRENGTHENING POOL 2018-19 (in descending order)

26. NHM PLANNING PROCESS

27. Communicated to States States submit Draft PIP Communicated to States/ UTS When States/UTs do not respond to request of supporting details To be circulated to Divisions

28. BOTTOM -UP APPROACH FOR PLANNING Integrate State Programme Implementation Plan State Integrate District District District Health Action Plan Integrate Block Block Block Block Health Action Plan Integrate CHC/PHC CHC/PHC CHC/PHC CHC/PHC Gram Panchayat Gram Panchayat Gram Panchayat Gram Panchayat Gram Panchayat Inputs from Gram Panchayat level and CHC/PHCs

29. Financial implications

30. RESOURCE ENVELOPE • Unspent balance (Committed & Un-committed) at the beginning of the Year • Central (GOI) Allocation to the States/UTs --80% (assuming no reduction on account of fulfillment of conditionalities) and --20% for Incentives • State Share 40% or 10% (NE and Hilly States) Less: Committed Un-spent Balance for validation Net Resource Envelope Available for Fresh Approvals From FY 2019-20, Separate proposals are asked on unspent balances as supplementary proposals

31. WEIGHTAGEFOR ALLOCATION OF FUNDS Population of Each State is given a weightage as under: NE and 3 Hilly States (H.P., J&K & Uttrakhand) (11) : 3.2 Small UTs : (4) (Lakshadweep, Daman & Diu, D& N Haveli & Andaman) : 3.0 EAG States, Except Chhattisgarh, Jharkhand (5) : 1.3 Chhattisgarh & Jharkhand (2) : 1.5 All other States/UTs (14) : 1.0

32. BASIS OF CENTRAL ALLOCATION TO STATES/UTS

33. COMMITTED & UN-COMMITTED BALANCE Committed Unspent Balance comprises of ---- • All advances given to Subsidiary Units, Implementing Agencies, • Work orders issued for any work but not paid (such as Procurements, Civil Works etc.) • Any other activity committed for implementation but not initiated during the current financial year e.g. ASHA’s, Training, JSY, JSSK. • All such activities need to be revalidated for expenditure in the next financial year. • No fresh approvals is required for these activities. • These Committed activities are against the ROP approvals already given.

34. COMMITTED & UN-COMMITTED BALANCE Uncommitted Unspent Balance : • Unspent Balance remained for those activities which could not be commenced in the current financial year and expected not to be utilized further. • The unspent balance assigned under the pools for expenditure becomes free for fresh approval in the next financial year . Letter on disclosure of Unspent Balances though Supplementary PIPJS P letter on USB.pdf for 2019-20 have been issued JS P letter on USB.pdf

35. FUNDING PATTERN UNDER NHM • From F.Y. 2015-16, keeping in view of the recommendation of 14th Finance Commission the Centre- State funding pattern has been revised to 60: 40 from 75:25 in all States excluding NE & 3 Hill States where it is 90:10. • All UTs are 100% Centrally funded except Delhi & Puducherry. • Incentive Pool of 20% of Central allocation has been created from 2018-19 to be effected from 2019-20 on the basis of conditionalities of 2018-19.

36. FLEXIBILITIES UNDER NHM • In–built flexibility as PIPs are proposed by States. • Utilise the amount of matching State share under any of the programme /schemes under any of the flexible pools of NHM as per the need of the State. • Under Infrastructure Maintenance (IM), 100% releases are made by way of reimbursement on the basis of ASE and instalment payment made towards salary, therefore the State share accrued under IM can be used as per the discretion of the State. • Pay demand based activities, salaries not to be withhold. Payment can be made from savings available under any pool.

38. Release under NHM • Two types of Grants in aid are released to States a) Cash Grant b) Kind Grant • Funds are released in 3 parts --- • General , Scheduled Caste Sub Plan (SCSP), Scheduled Tribe Sub Plan (STSP). • All releases are made on the basis of Census Population of 2011. • Further break up releases in Revenue and Creation of Capital Assets. Creation of capital assets involved in Health System Strengthening, NUHM and NCD. Basically where civil construction is involved.

39. CRITERIA FOR RELEASE OF FUNDS • First release of 75% of 80% of B.E. a) No shortfall under State’s Matching contribution. b) Provisional UCs of last F.Y. c) Regular Financial Reporting and Physical Reporting in FMR & SFP d) Considering the Unspent balance e) Transfer of fund from Treasury to SHS. • Final release of balance 25% of 80% of B.E Same as (a) to (e) above. Receipt of Statutory Audit Report and Audited UC Ensure the increase in State Health Budget by 10% over last year. 20% of funds under Flexi Pools have been earmarked towards Incentivization of States/Uts.

40. New Initiatives • Single Bank Account to avoid parking of funds and better financial utilisation. • National Consultation with Banks for finalisation of RFP has been held and is in the process of dissemination. • Dash Board is being developed in support of NIC for online booking of expenditure in FMR from peripheries.

41. Cost Benefits & Cost Control Practices Cost Control Mechanisms in NHM Context: • Procurements through Competitive Bidding • Differential Financing under Untied funds, Referral Transport etc. • Need based procurements. • Centralized procurement of medicines through bulk purchases. • Single bank account system to avoid loss of interest.

42. Auditing under NHM • Performance Audit under NHM by CAG • Statutory Audit by CAG empanelled major CA Audit firms. (Mandate – 100% for DHS and 40% for Blocks) • Concurrent Audit by CA Audit firms on monthly basis. However, reports to be issued on quarterly basis. (100% for all Blocks) • IPAI Audit for selected States. • Internal Audit.

43. Critical Observations • Avoid parking of funds as that would hamper the implementation. • Not to include the Bank balances of Non-NHM Schemes such as Finance Commission, NABARD, State Health Schemes as that would make the overall balance under NHM heavier in the Balance sheet and leading to CAG’s observation on high unspent balance with State Health Societies. • Prohibit the diversion of NHM funds to State run health schemes.

44. Critical Observations • Civil works: Rule 351 of PWF&AR provides that the availability of land should be ensured before awarding the construction work. • Bank accounts needs to be operated by Joint signatories, at least one person must be regular. • Closure of Non-Operative Banks Accounts. • Mapping of All Banks with PFMS application. • Funds received at SHS , DHS and Blocks need to be transferred immediately to subsidiary units after considering the unspent balances.

45. Critical Observations • Ensure Compliance of GFR Rules, 2017 for release of funds, procurement of Services, Goods etc. • State Finance Rules for Procurement of Services, Goods may be followed. • Temporary loans can be taken and to be returned to original pool on receiving of funds. Permanent diversion is prohibited. • Regular monitoring of advances with Age wise analysis • Ensure JSY and ASHA Payments through DBT • Ensure submission of Consolidated FMR with Physicalachievements on monthly basis covering all programmes of NHM (including IM)

46. Critical Observations • FMR includes expenditures from each programme and of all levels. • Monitoring and ATR on the findings of the Concurrent Audit and Statutory Audit. • Plan training programmes on FM within the State and District • Understand and implement the concept of ongoing activities and issue directions for continuation of such activities after 31st March without waiting for ROP.

47. Critical Observations • Non preparation of Bank Reconciliation Statement (BRS). • Non-maintenance of Fixed Assets Registers. • Splitting of Invoices to avoid competitive bidding – Especially Procurement Processes. • Booking of expenditure without approvals or more than approvals. • Non compliance of procurement procedures. • Books of accounts not closed at year end and interest nor accounted for.

48. Important Communications • Advances to Implementing Agencies for Civil works, Procurements may be treated as deemed Expenditure for the purpose of Release proposals. • Refer to D.O. Letters issued from time-to-time providing instructions/ guidelines – such as Banking Arrangement, Temporary diversion of funds, non- holding of committed liabilities etc. • Refer D.O. letters on separate reporting of expenditure given under Tribal Sub Plan (TSP). etc.

49. CHALLENGES • Compliance of DOE conditionalities on just in time basis • Ensure to receive funds from State Treasury to SHS within 15 days of transfer. • Fulfillment of ROP conditionalities to earn Incentives. • Increase in Health Budget at least by 10% over last year. • Improve the pace of utilization to avail the full Central Grant.

50. CHALLENGES • Timely submission of Audited UCs • Submission of Certified Audited Expenditure on time to claim arrears under IM. • Contribution of Matching State Share simultaneously with Central Grants including IM • Statutory Audit Report to be approved by Governing Body. • Also laying of Audit Report in the house of State Legislative Assembly.