Download this case study in the following languages:
The Ugandan healthcare supply chain system is a mature healthcare system with national policies in place to support appropriate outsourcing to the private sector. This document provides a perspective of the key stakeholders in the health supply chain and then describes examples and case studies of supply chain outsourcing by the public sector to the private sector.
- Inbound logistics and customs clearance is partially outsourced
- Distribution is partially outsourced – specifically last mile delivery
The first example describes how the Africa Resource Centre (ARC) partnered with the Ugandan Ministry of Health (MoH) to collect geo-mapping data for the analysis of differentiated service delivery models and assist the MoH in verifying and updating their Master Healthcare Facility Registry for all healthcare facilities. The benefits of the exercise included increased numbers of geo-located healthcare facilities and pharmacies (over 7,200 health facilities and 1,100 pharmacies) and verified updates to the MoH master file list of facilities.
The second example of outsourcing to the private sector describes the co-ordination of last mile deliveries of vaccines. The United Parcel Service (UPS) in partnership with Freight in Time (FiT), implemented an 18-month pilot to review links from the National Medical Stores (NMS) to health centres, focused on the efficient and cost-effective movement of vaccines using appropriate transportation methods with reliable cold chain equipment. The pilot showed improved delivery of vaccines to the last mile, increased availability of vaccines at the health facility level, improved cold chain equipment management and temperature monitoring, and the identification of human resource gaps at district vaccine stores and health facility level.
Uganda also provides examples of the outsourcing of last mile deliveries to third-party logistics providers (3PL) companies. The 3PL providers supply medicines to 3,133 health facilities.
These examples demonstrate practices and approaches to outsourcing elements of the healthcare supply chain by the public sector to the private sector and identification of tools that can assist governing bodies to drive improved health outcomes.
Health sector policy
The 2015 National Medicine Policy and the National Pharmaceutical Sector Strategic Plan 2015-2020 (NPSSP III) focused on key health issues, including regulation and legislation, supply chain, medicine use, financing, and pricing under the consideration of the overall national development agenda. According to NPSSP III, the pharmaceutical sector includes private not-for-profit and private for-profit sites.
The goal of the Health Sector Development Plan 2015/16 - 2019/20 is to accelerate movement towards Universal Health Coverage. The health governance and partnerships priority of the plan focuses on strengthening public-private partnerships and coordination. The government of Uganda and the MoH are open to outsourcing and collaboration with the private sector to achieve its goals of providing quality healthcare for all Ugandans.
The healthcare supply chain
Figure 1 refers: The Uganda healthcare supply chain comprises eight key stakeholders. Primary organisations in the supply chain include the Government of Uganda, National Drug Authority, USAID, The Global Fund to Fight AIDS, Tuberculosis and Malaria, the Centre for Disease Control, UNICEF/GAVI, DFID, United Nations Population Fund. The next step and stakeholder set in the chain include the NMS, Joint Medical Stores (JMS) and Medical Access Uganda Limited (MAUL). The private sector participates in:
(i) In-bound logistics and customs clearing,
(ii) Distribution from national warehouses to district facilities and
(iii) Distribution from district facilities to health centres.
The private sector also plays a vital role in demand and supply planning, procurement, warehousing, transportation and supply chain strategy design as participants and contributors to the Technical Working Groups and as part of the advisory committee
PRIVATE SECTOR OUTSOURCING – EXAMPLES
This section shares examples drawn from a combination of desktop research and interviews of outsourcing to private sector partners. i. Geo-Mapping to update the Master Healthcare Facility Registry: ARC Context Africa Resource Centre (ARC), an independent strategic advisor, partnered with the Ugandan MoH to collect geo-mapping data for the analysis of differentiated service delivery models and assist the MoH in verifying and updating their Master Healthcare Facility Registry for all healthcare facilities.
ARC’s objectives, in support of the MoH, was to carry out a national geo-mapping survey of all healthcare facilities in Uganda, develop a Master Healthcare Facility Registry, develop guidelines and standard approaches for the geo-mapping of data in the health sector and establish gaps that existing in the geo-mapping of healthcare facilities. Outcomes and benefits The Geo-mapping survey allows MoH to:
- Finalise a Master Healthcare Facility Registry for healthcare facilities and pharmacies
- Finalise survey guidelines and standard approaches to geo-mapping data based on learnings and insights
- Take full control of the Open Data Kit (ODK) collection process for future updates, as a result of the train the trainer program to transfer skills and ensure ownership by MoH
- Make use of the SpatialXL mapping tools and GIS data to: - Review and analyse the differentiated service delivery models - Identify gaps in service delivery - Inform health sector planning and guide decision making at national and sub-national levels
ii. Coordination and evaluation of last mile deliveries project: Vaccines Last Mile Delivery (LMD) pilot project Context The Uganda National Expanded Program on Immunisation (UNEPI) in collaboration with NMS and with funding from GAVI, commissioned an 18-month pilot study in three districts for the distribution of vaccines to the last mile through an outsourced logistics service provider.
UPS in partnership with Freight in Time (FiT) implemented a pilot that started in May 2018, across the districts of Nakaseke, Nakasongola and Wakiso districts. GAVI requested FiT in partnership with MoH-Uganda, the GAVI country office, UPS and NMS to review links from the central store (NMS) to the health centres, in relation to the efficient and cost-effective movement of vaccines using the appropriate transportation methods with reliable cold chain equipment (CCE). The Clinton Health Access Initiative (CHAI) together with MoH developed the data collections tools. Outcomes and benefits The pilot demonstrated significant improvements in the distribution of vaccines.
Key findings include:
- Improvement in Delivery of Vaccines to the Last Mile: District delivery of vaccines to health facilities increased from 3% at baseline to 96% at the midline. The availability of a district ordering and delivery schedule improved from 36% at baseline to 89% at midline, resulting in improved scheduling of deliveries.
- Increased Availability of Vaccines at Health Facility Level: Across all vaccines, HPV and ROTA showed the highest improvements in-stock availability between baseline and midline; from 59% to 92% and from 65% to 92% respectively. The proportion of facilities with all antigens in stock at the time of the assessment increased from 76% to 92% and the average stock out days reduced from 18 days at baseline to 12 days at the midline.
- Improvements in Cold Chain Equipment Management and Temperature Monitoring: Cold chain functionality was maintained above 90% at midline and the availability of fridge tags within functional fridges increased from 68% to 95%.
iii. Outsourcing of Last Mile Delivery: 3PL’s Context An example of the private sector playing a role is the outsourcing by NMS of last mile delivery for Government Health Centres II, III and IV to 3PL providers, who pick up and deliver prepacked medicines. The NMS has divided Uganda into 5 zones for delivery scheduling and deliver to cross-docking stations (in addition to direct deliveries to hospitals) into 136 districts where the 3PL collects the medicine and delivers to allocated health facilities.
The 3PL providers supply medicines to 3,133 health facilities, split between Beyond Logistics delivering to 1,255 facilities and Threeways Distribution LTD delivering to 1,973 facilities. These two companies engage other logistics service providers and regional or district level to undertake the final mile distribution. Outcomes and benefits Outsourcing to private sector partners has provided multiple benefits to the Ugandan health supply chain. These benefits improve the management and delivery of medical commodities to the people of Uganda.
- Real-time Tracking: 3PL’s improved live tracking and visibility of vaccines and medicine from collection to the final delivery point.
- Rapid and Accurate Delivery: Effective call cycle planning is used by the 3PL’s to deliver resulted in faster and more accurate delivery.
- Optimisation of Fleet: utilising different vehicle sizes and types, the third-party logistics providers can ensure that the most optimal form of transport is used depending on the conditions experienced in rural and difficult to reach areas.
- Improved Data Visibility: Efficient reporting back to NMS by using Last Mile Distribution APP, ensuring real-time information for NMS and 3PL’s to plan and achieve optimum patient care.
- Collaborative Effort: Guidance from the NMS for the 3PL’s is achieving success and ultimately improving distribution and patient care.
- In Uganda, 3PL partners significantly improve and enhance the delivery of medical commodities through the above-mentioned methods to strengthen the supply chain and distribution performance in the health supply chain.
There is a high level of collaboration between MoH, NMS JMS, MAUL and other key stakeholders. MoH manages and support JMS and MAUL by using the memorandum that is in place. MoH support and drive change with the National Drug Authority and National Medical Stores playing key roles in identifying policy and regulation to achieve the goal of Universal Health Coverage.
The National Medical Stores have a three-fold mandate: to procure, warehouse and distribute essential medicines and medical supplies, particularly to Government health facilities. Distribution and clearing are carried out by logistical service companies such as Bollore, DHL and UPS with contracts between the donors and private sector suppliers. Private sector 3PL service providers distribute medicines from the National Medical Stores to 3,133 health facilities.
This document identifies various roles performed by the private sector, the benefits achieved, and the different approaches used. Examples of private sector outsourcing have been identified and high-level descriptions documented. These examples exhibit good practices in the approach to outsourcing to private sector partners and can help governing bodies to drive improved outcomes for their health supply chains and identified tools to assist the public sector to drive improved outcomes for outsourcing.
Bonface Fundafunda – ARC – SME 19/06/2020 Le Beau Taljaard – ARC – SME – 19/06/2020 Raj Thakar – MD Translink – 12/06/2020 Sue Meiring – SMC Consulting Owner – 15/05/2020 Gerald Jackson – SME SC – 28/05/2020 Paul Bitarabeho – ARC Uganda – 3/6/2020 Eric Sanchez – Bollore – 17/06/2020 Luc Angwenyi and Nancy Amony – FIT 02/07/2020 Sowedi Mayingo and Rashid Settaala MAUL – 02/07/20220 Suzan Nakawunde – USAID SC Head Uganda – 03/07/2020 Andrew Nsubunga and Eleanor Ayebare – Beyond Logistics – 03/07/2020 Dr Hudson Balidawa – MoH Uganda – 08/07/2020