Purchasing of healthcare services is a critical component of healthcare financing. The purchasing mechanism adopted is the key to making health providers deliver better quality, undertake prevention programs that have an impact on the health of a population and manage healthcare costs. With serious efficiency challenges facing health systems there has been a greater drive to practice strategic purchasing as an efficiency goal in the use of scarce resources. An emerging agenda is how healthcare services could be purchased more strategically to promote quality in service delivery, manage expenditure growth and promote efficiency in service delivery. The study explored the purchasing arrangements for the teacher‟s medical scheme. Methodology: This was an exploratory qualitative study utilizing purposive sampling for the fund managers of the teachers‟ medical scheme and convenience sampling for the beneficiaries of the scheme. Participants were consented and in-depth interview guides used to collect data. Four fund managers and six beneficiaries were interviewed to a point where data saturation was attained. Data was analyzed using thematic content approach with predetermined themes on purchasing. Purchasing elements were compared against the actions of an ideal strategic purchaser and other purchasing actions. Results: The teachers‟ medical scheme has a well-articulated benefit package, uses limited capitation and fee for service as the provider payment mechanisms, contracts providers based on their regional distribution and through accreditation process and utilizes private providers only. Key strategic actions implemented include use of drug formularies, fraud monitoring and providers performance monitoring. Other practices include irregular payment of providers and lack of benefit updates with changing trends and alignment to populations‟ needs. Conclusion: There is limited strategic purchasing being practiced within the teachers‟ medical scheme especially with regard to the design of the benefit package and provider payment mechanisms.