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Better Governance and Institutional Architecture- A Key to Efficient Procurement of Medical Consumables in Kerala, India

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Better Governance and Institutional Architecture- A Key to Efficient Procurement of Medical Consumables in Kerala, India


Agenda for Universal Health Coverage should be seen in the context of quality, availability, prices and efficient procurement systems. However, access to essential and good quality medicines is limited in many parts of the country due to government inefficiencies, poor planning and corruption. Public procurement is increasingly recognized as a central instrument to ensure efficient and corruption-free management of public resources.


To understand the public procurement model of Kerala Medical Service Corporation Limited (KMSCL), a central procurement agency for all essential drugs and equipment in Kerala, with a special focus on the governance and institutional architecture.


A qualitative study method was adopted to understand process and factors that influence governance, decision making, regulations and policy changes. We collected information from Calicut, Palakkad, Thiruvananthapuram and Wayanad districts of Kerala through briefing meetings with senior governmental officials, in-depth interviews and extensive literature review. We adopted the WHO’s Organizational Assessment for Improving and Strengthening Health Financing (OASIS) framework for understanding institutional design of health financing.


The study findings with respect to governance in KMSCL is similar to other low-and-middle income countries such as Bolivia, Indonesia, Mongolia and Papua New Guinea. Kerala follows a centralized procurement system with clearly defined guideline and protocols in place. KMSCL have an efficient procurement system with a coherent decision-making structure and strict regulatory systems in place. These are further supported by a presence of e-tendering approach; competitive and transparent bidding process; strict quality assurance procedures; efficient drug distribution management; periodic evaluations and a reliable financing mechanism. Additionally, transparency and quality assurance are found to play central role in the whole procurement mechanism. However complaints regarding non-availability and delayed supply of drugs, conflict of interest among key staff and committee members and accountability, poor grievance redressal mechanism are the issues faced by KMSCL while procuring drugs and equipment.


A good governance in procurement system of Kerala is assured by strong decision-making authorities, clearly defined organizational framework and transparent systems. However KMSCL could address the issues related to the need for comprehensive protocols and guidelines to delineate clear levels of accountability and governance for all personnel involved, establishment of an online grievance redressal portal for registering and resolving complaints including selection process, delayed payments, etc. and publically accessible audit reports, grievance redressal reports for a more transparent system and an active involvement of private agencies and community participation in decision making bodies.

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