The COVID-19 pandemic and the global response to it are essential in explaining health outcomes and the effective functioning of primary healthcare systems. The adequate functioning of primary healthcare systems depends on the degree of professional organization and each country’s ability to provide administrative services, which is defined as part of the state’s capacities. Among Latin American countries, Brazil has a highly rated Unified Health System, which was formed during democratization when the popular health movement’s role in government control increased. The existing literature is filled with criticisms of the state’s diminishing role due to neoliberal reforms since the 1990s. These reforms have weakened primary healthcare and accelerated the damage caused by COVID-19. However, the relationship between the state’s essential capacity and COVID-19 measures has yet to be explained. This study analyzes primary healthcare policy and assesses health system outcomes while coping with the COVID-19 pandemic. The results indicate that path-dependent disparities negatively impact the health outcomes of the primary healthcare system.