The Pecuniary Plan: How much does it really cost to set-up a hospital in India

Updated: Nov 13, 2020

The Indian healthcare sector is unique in terms of the fair share of competent healthcare that the private sector hospitals deliver in India; while elsewhere it’s mostly a prerogative, here it’s the very accessibility to adequate health care for the vast populace.

In spite of all the efforts, the healthcare capacity is yet to comply with the WHO benchmark of at least 30 hospitals to tend to 10,000 people.

Therefore, it’s evident that not only strengthening the health care facility with state-of-art upgrades are the need of the time, but also encouraging new private clinics and hospitals are quite necessary to improve the health care scenario throughout the Indian subcontinent.

Source: Liaison

Setting up a small hospital in India isn’t a smooth sail. The complex course of regulatory approvals and associated paperwork is undoubtedly cumbersome to deal with; however, more daunting is the cost constraint. Not only establishing a health care facility but its on-going maintenance demands full-fledged financial planning for hospital set-up, and it begins at estimating the cost to set up a hospital in India as closely accurate as possible.

The cost to set up a hospital in India depends on two per-determinants:

1. The intended capacity of the health care facility.

2. The level of health care the facility intends to offers.

The land and construction cumulatively require 50-60% of the total capital cost. Once you’re sorted with finances for the land or construction project, the entire set-up that follows to get the health care facility fully functional comes down to roughly one half of what’s already spent in acquiring or building the premises from the facility.

The medical equipment, consumables, and ambulatory services though doesn’t claim the lion’s share in Setting up a small hospital in India, it’s a recurrent cost.

Implementing cost-effective procurement is an indispensable long-term benefit to the organization and best to be also the part of initial financial planning for hospital set-up.

On an average a tertiary care super specialty hospital cost may escalate to 70 Lakhs to facilitate its every bed with excellent advanced health care; this includes 3 t MRI, 64 Slice CT, 4D Ultrasound diagnostics and other state-of-art facilities as well as provision for Cardio-thoracic Surgery, Neurosurgery, proficient Orthopedics department, equipment for Oncology and Radiology treatment therapy.

In addition to the infrastructural and system set up, another 10% each from the total estimated cost is to be set aside for contingency and cost-build up due to processing lags in the hospital set up.

Basic cost-layout for Setting up a small hospital in India

In General, the following needs to be in the layout of a basic healthcare facility and we’ve put together an approximate cost-capping in setting up and making the concerned department fully-functional in delivering competent health care to the masses.

Disclaimer – this is an indicative cost acquired from a copious amount of research from several sources and it may vary from the actual hospital set-up cost.

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