The public health sector supply chain costs in Tanzania

Abstract

Tanzania’s supply chain system is a complicated web of integrated and vertical systems, covering essential and vertical programs health commodities, laboratory and diagnostics, equipment, and supplies. Despite significant improvement in the supply chain over the decades, the availability of medicines has remained uneven. Therefore, identifying the cost of operating the supply chain is vital to facilitate allocation of adequate finances to run the supply chain. We adopted a three-step approach to costing, which included i) identification, ii) measurement, and (iii) valuation of the resource use. Two levels of the Tanzanian supply chain system were examined to determine the cost of running the supply chain by function. These included first the Medical Stores Department (MSD) central and zonal level, secondly the health service delivery level that include National, Zonal and regional hospitals and the Primary Health Care (District Hospital, health center and Dispensary). The review adopted the health system perspective, whereby all resources consumed in delivering health commodities were considered, resource use was then classified as financial and economic costs. The costing period was an average of two financial years, 2015/16 and 2016/17. The cost data were exchanged from Tanzania Shillings to 2017 US$ and then adjusted for inflation to 2020 US$. The study used the total sales reported in audited financial accounts for throughput value. The average annual costs of running the supply chain at the central MSD was estimated at USD$ 15.5 million and US$ 4.1 million at the four sampled MSD Zonal branches. There is a wide variation in annual running costs among MSD zonal branches; the supply chain’s unit cost was highest in the Dodoma zone and lowest in the Mwanza zone at 26% and 8%, respectively. When examined on a cost-per-unit basis, supply chain systems operate at sub-optimal levels at health facilities at a unit cost of 37% per unit of commodity throughput value. There are inefficiencies in supply chain financing in Tanzania. Storage costs are higher than distribution costs, this may imply some efficiency gains. MSD should employ a "just in time" inventory model, reducing the inventory holding costs, including the high-expired commodities holding charge, this could be improved by increasing the order fill rate.

Do community health committees participate in governing health workers in primary healthcare facilities under fiscal decentralization?—An explanatory qualitative study from Tanzania

“…24 In this arrangement community governance structures, which in Tanzania are known as HFGCs are assigned fiscal powers and responsibilities of participating in planning and budgeting financial management and procurement which they to use in accomplishing their core functions which one of them is participating in managing and governing facility health workers. 16,25 Therefore, under DHFF context it is expected that HFGCs would have such fiscal power in making significant decisions about the management of health workers at their facilities. Before the DHFF in Tanzania, different assessments empirical evidence suggests that HFGCs had poor functionality, including in managing health workers, because they had limited fiscal powers, among other things.…”

“…The DHFF arrangement involves direct depositing of health facility funds from different sources such as Basket funds, Ministry of Finance (Intergovernmental transfer), user fees and funds from different insurance schemes 24 . In this arrangement community governance structures, which in Tanzania are known as HFGCs are assigned fiscal powers and responsibilities of participating in planning and budgeting financial management and procurement which they to use in accomplishing their core functions which one of them is participating in managing and governing facility health workers 16,25 . Therefore, under DHFF context it is expected that HFGCs would have such fiscal power in making significant decisions about the management of health workers at their facilities.…”

“…However, there is little information on the extent to which community governance structures or HFGCs participate in managing and governing health workers in many developing countries. The available empirical evidence on fiscal decentralization has focused on the functionality of HFGCs under fiscal decentralization, the accountability of HFGCs under fiscal decentralization, the acceptability of the DHFF approach to service users, and the breadth of HFGC role and functionality 24,25,27 . The purpose of this study was to determine the level of participation of HFGCs in health worker management functions in public PHC facilities that were implementing DHFF.…”