Can drug quality and service quality be maintained?
Contractors may try to cut corners in order to reduce costs. This may adversely affect both the quality of the service (as measured by the rate of shortages and stockouts) and the quality of the drugs delivered. • Will efficiency actually improve? If lower costs are achieved at the price of lower quality then the result in terms of improved efficiency is ambiguous. • Can government effectively negotiate and monitor contracts? The benefits of competitive contracting will not be reaped unless government has adequate negotiating and monitoring capacity. Contract specification must cover the quality of the service in adequate detail and must include sanctions against contractors who break quality standards. Contracted services must be monitored to ensure that they are provided as specified in the contract. Government may operate under constraints in capacity that prevent it from carrying out these tasks effectively. • Will there be sufficient financing? Alternative supply arrangements may
