Strengthening Health Sector Procurement System Offer Hopes for Universal Health Coverage in Nepal

by Atin Kumar Rastogi,
Sr. Procurement Specialist, World Bank

What could possibly be the connection between this beautiful picture and procurement reforms in the health sector?

The goal of Universal Health Coverage (UHC) is difficult to scale, even for high-income countries. Yet, when a lower middle-income country sets its brave sights on this lofty goal, a beautiful story takes shape.

Not unfamiliar with the tough journey that development entails, Nepal committed to the goal of Universal Health Coverage in its National Health Sector Strategy (2015-20) ensuring equitable access to quality health services for its citizens leveraging a multi-sectoral approach to meet this goal.
This requires health system reforms. Weaknesses in management of the health system were undermining access to and quality of public health services and public-sector governance was stymying improved health outcomes for citizens of Nepal.

With the support of the World Bank, Nepal's Ministry of Health designed an ambitious Program for Results (P4R) operation in 2016 to improve efficiencies in public resource management of the health sector. A key element of this operation was to strengthen the Ministry's public procurement function. Weak capacities for efficient and effective procurement decision making inevitably resulted in delayed availability and often-times sub-optimal quality of drugs and stock shortages and even expired drugs due to inefficiencies in the supply chain and distribution system.

The Ministry of Health sought to standardize specifications for health sector goods; manage contracts issued through an e-procurement portal; establish and operationalize an online logistics management information system linking all district stores; and operationalize an effective grievance redressal system in procurement.

All these systemic changes were new and required a design that was sensitive to the Nepal context, but also strong behavioral change amongst officials of the Ministry of Health to make the inputs functional and effective. Intensive capacity building was planned at all levels—national, regional, and district level for planning, budgeting, implementation, and oversight of the health program.

Standardizing the specifications for health sector goods is expected to help improve the quality of goods and services offered by the public health system. The e-procurement system boosts transparency in public procurement and enhances competition - thereby securing best value for money. The grievance redressal mechanism is anticipated to complete the essential feedback loop to help weed out inefficiencies and poor practices that impinge on the quality of services delivered by the public health system. An effective logistics management information system will ensure that health sector goods, especially drugs, are available when and where required with minimal loss and wastage. These systemic changes offer a better experience and improved health outcomes for the people who rely on the public health system. An improved public health system also provides a viable and more affordable alternative for those who have had to turn to private sector providers -- at great out-of-pocket expense – to receive quality healthcare.

Health procurement reform in Nepal is not an easy path to pursue. It demands sharp planning, persistent execution, and strong, high-quality monitoring to achieve desired results. Nepal is known for its resilience and tenacious ability to surmount all challenges—even ones that are as steep as Mount Everest. The beautiful picture of improved health service delivery is coming together, slowly but surely.