*PFM WEEKLY UPDATES* *HEALTH SECTOR* *SHIF roll-out faces early implementation challenges.* • Patients recently protested at the Health CS’s office over failures in the new Social Health Authority (SHA) system, citing delays, high personal expenses, and restricted hospital access. If these issues persist, they could escalate into a nationwide healthcare crisis. • The transition from NHIF to Taifa Care is struggling with NHIF’s outstanding debts, as the Ksh 8.7 billion payout remains insufficient. The 2025 draft BPS links the debt to a shortfall between contributions and healthcare costs, highlighting the need for a phased repayment plan. • Tax-financed funds, especially the Primary Healthcare Fund, face inadequate allocations. During his visit to KNH, the Deputy President highlighted this, noting the PHC fund’s Ksh 4.1 billion allocation fell short of the budget. These gaps hinder healthcare service delivery, hence requiring increased funding. *U.S aid freeze puts Kenya’s health programs at risk.* • The U.S. withdrawal from WHO and aid freeze could endanger Kenya’s health sector, particularly donor-funded HIV/AIDS, malaria, and TB programs . With the U.S. committing $392.99 million for 2023–2025 compared to Kenya’s KShs. 27,690 million domestic allocation, the country’s dependence on donor funding highlights the urgent need for sustainable local financing. • The loss of U.S. funding threatens the supply of essential medications and continuity of treatment programs, risking higher disease transmission and mortality rates. In response, Kenya should seek short-term support from other international donors and private sector partners while prioritizing long-term domestic resource mobilization for sustainable healthcare financing.