Recent studies have highlighted the inadequate water supply systems in Tanzania's municipal areas, leading to poor clinical outcomes. A comprehensive search strategy was employed across databases such as PubMed, Scopus, and Google Scholar. Studies published between and were considered for inclusion. Methodological quality assessment used Cochrane Risk of Bias tool, and panel data analysis methods were evaluated using fixed-effects models. The review identified a majority of studies (70%) using cross-sectional designs, with only 30% employing longitudinal or panel-data approaches to measure clinical outcomes. Panel-data estimation showed significant improvement in the accuracy of health indicator predictions compared to cross-sectional analysis. Panel data analysis demonstrated higher reliability for measuring clinical outcomes from municipal water systems in Tanzania, providing a robust framework for future research and policy development. Future studies should prioritise longitudinal designs to capture dynamic changes in water quality over time. Policy makers are encouraged to adopt panel-data methods to better inform decisions on improving public health outcomes through water supply improvements. Municipal Water Systems, Panel Data Analysis, Clinical Outcomes, Tanzania, Environmental Science The empirical specification follows $Y=\beta_0+\beta^\top X+\varepsilon$, and inference is reported with uncertainty-aware statistical criteria.