Officials said the AAP government had changed the name of the scheme.
The Centre's decision to stop funds to Punjab for a nationwide health scheme sets up the next big clash between the BJP and Arvind Kejriwal's Aam Aadmi Party (AAP), which rules the state.
The funds given to states under the Ayushman Bharat for Health Wellness Centres will not be released for Punjab, top health ministry sources said today, accusing the AAP government of changing the name and branding of the scheme.
"The money is given for this scheme. If there is no scheme, then no money. Punjab has not only changed the branding but has also started calling them mohalla clinics," sources said.
Last week, Union Health Minister Mansukh Mandaviya said in parliament that both Punjab and Andhra Pradesh had created healthcare facilities by using the Pradhan Mantri Jan Arogya Yojna.
The Union Health Ministry reportedly wrote to the Punjab government recently saying that it would be "improper" to deviate from the terms of the Memorandum of Understanding.
In 2018, all states had been instructed about the branding, colour and coding to be used for the health scheme. Punjab had failed to follow the instructions, sources said.
Last year, Punjab received Rs 145 crore under the scheme.
AAP, which came to power in Punjab last year, recently launched 400 more Aam Aadmi clinics in the state, taking the total number of the neighbourhood clinics to 500.