Nigeria faces significant challenges in municipal water systems, impacting public health outcomes. Panel data estimation was used to analyse the impact of municipal water systems on public health metrics. A negative coefficient (-0.52) was observed in the panel-data regression model estimating the effect of water quality on hospital admissions, indicating a reduction with improved water treatment facilities. The findings suggest that better municipal water management can lead to reduced hospital admissions related to waterborne diseases. Investment in upgrading water treatment plants and educating communities about safe water practices is recommended. The empirical specification follows $Y=\beta_0+\beta^\top X+\varepsilon$, and inference is reported with uncertainty-aware statistical criteria.