It's definitely improved over the years, but every remotely populated server I'm in uses bots for basic moderation features like ban words, proper bans/kicks (for example, temporary bans), warns, etc. There's still a long way to go in my opinion.

I'm not aware of anything that does a better job than discord. So they can be doing a fantastic job relative to the competition while still leaving stuff to be desired. Although bots are not really a bad solution and they leave the tools in the hands of the users who can now do just about anything.

I disagree. In my opinion those tools are the bare minimum for effective moderation, and while I love that Discord gives developers an API that allows them to implement those systems, I think it's something that should be handled by Discord themselves.