In the wake of Covid-19 pandemic which has infected over nine lakh people across the country, the Union Health Ministry has revised its fund requirements to Rs 6.04 lakh crore during 2021-2026 as it identified new areas for support which include urban health, essential medicines, Diplomate of National Board (DNB) courses and post-Coronavirus health sector.
The Ministry has submitted a revised proposal for fund requirement to the Finance Commission from the earlier demand of Rs 4.99-lakh crore.
After a meeting with the 15th Finance Commission, the Ministry in a statement said it will require Rs 6.04 lakh crore to fund healthcare during the five-year award period 2022-2026, to support new areas including post-Covid health sector reforms. The estimate increased by Rs 1.05 lakh crore from the earlier requirement of Rs 4.99 lakh crore.
The Commission held a meeting with Union Health Minister Harsh Vardhan and senior officials of the ministry on revising the State-specific proposals of the ministry in light of the Covid-19 experience. “Looking at the peculiar state of the pandemic, the commission’s final report will have a separate chapter on health,” said Chairman of the Commission, NK Singh.
The ministry pointed out that currently 35 percent of the public health expenditure is done by the Centre and 65 percent by the state governments.
“The pandemic has established the importance of the need to strengthen the public health sector, surveillance and public health management, preventive and promotive health care with special focus on urban health. “The ministry also felt that there was a need to increase the allocation of the Ministry of Health and Family Welfare on a year to year basis,” the statement said.
The meeting was held to discuss the specific issues of revising the State-specific proposals of the ministry in light of the Covid-19 experience, exploring the possibility of backloading in the light of fiscal strain and consideration of the suggestions of the High-Level Group of the 15th Finance Commission on health, the statement said.
The National Health Policy (NHP) 2017 targets include increasing public health expenditure to 2.5 percent of the GDP in a progressive manner by 2025, Primary Health Expenditure to be 2/3rd of the total health expenditure and increase state sector health spending to more than 8 percent of their budget by 2020.
The Commission agreed that there was a need to increase public sector health outlay and also to develop a professional cadre of health workers, the statement added.
For performance based incentives, the Ministry has proposed a composite health index to encourage States to improve performance on a year-on-year basis. It should have a weightage of 20 per cent in the performance linked pool.
It also sought State specific funds for setting up medical colleges attached with district hospitals.
