Fragmented management approach makes the provision of comprehensive health care for achieving universal health coverage very unlikely. This article aims to explore the potential contribution of a systemic approach—the sector-wide approach (SWAp)—to achieving universal health coverage (UHC), using the Mongolian context as an example. The paper describes UHC and factors that hinder its achievement in developing countries, based on the Mongolian experience. The analysis focuses on the root factors hindering the achievement of UHC and examines how these affect system and local capacity critical for achieving UHC. Two principally different approaches, a sector-wide (holistic) approach and a standalone project (fragmented) approach are compared in terms of their contribution to the main indicators of achieving UHC. The current stage of the Mongolian health SWAp is identified and early rewards of a SWAp are presented. The paper proposes a SWAp as a potential approach to tackle these root factors to help in achieving UHC, because it is a promising instrument that promotes a systems-strengthening and capacity-building approach to enable effective coordination of standalone projects in alignment with the national priorities.