How to set up your Hospital/Clinic?

Posted: May 08, 2023

Author: krishna Mishra

Quality and affordable healthcare is a necessity to lead toward a healthy community. With the changing pace of healthcare transformation toward digitalization, quality, and affordability, there has to be continuous improvement and transformation in the platforms delivering medical care and related services. In a digital age like today, this is possible by deploying efficient health systems and smart medical care. An efficient and smart medical care is the process of delivering patient-centric care within or beyond the hospital walls by connecting patients, data, and technology. This will help in reducing redundancy as well as saving money that is wasted on repetitive administrative tasks

Fundamental points to be considered for starting a cost effective and patient centric medical practice are discussed as follows:

1. Advisory team formation

A good team of experienced professionals who can guide and provide insights about the specific needs of the hospital, helps in making important regulatory decisions and proving the credibility of your medical practice among investors and patients. Three to five professionals at an initial stage would be ideal in an advisory team depending on the sectors in which you want the expertise in.

One healthcare leader, one technology leader, and one experienced physician who is having a blended knowledge of both healthcare and technology and has strong connections in the niche of interest would be highly preferable in the advisory team.

It would be very much beneficial to take advice from medical associations who are knowledgeable in the regulatory regime for medical practitioners. Government bodies can also be a great source of information for any type of government schemes and incentives.

2. Streamlined business planning

A plan from start to end should be developed to analyze the requirements, strengths, and limitations throughout the steps or processes involved in setting up your clinic.

Determine the structure of the business keeping in mind the goals of expanding the business, and potential income to manage the staff and business running in a flexible and efficient manner.

Design the structure so that you may easily convey the fundamental business viewpoint or information to the market including all the stakeholders. Always record your plan so that you do not leave any important pieces of information. One of the best methods to analyze the strengths, weaknesses, opportunities, and threats is undertaking a SWOT analysis as follows:

3. Financial Planning

After designing the business structure, you will have an estimate of the amount required as an initial investment to start the clinic. Identifying one-time costs and ongoing costs is significant while planning for finances. Key points to consider while opting for finances include eligibility, interest, processing charges, and repayment structure. Connecting to certified financial advisors will be beneficial for finance management, loan advice, and investor options for your healthcare facility.

Clinic specialties and location: The investment cost depends on the healthcare facility, its specialties, and the location of the hospital or clinic. Premises should have adequate facilities like elevators, parking spaces, and exclusive entry & exit. For example, a general medical clinic does not require specialized medical software whereas a specialized clinic requires specific diagnostic software and equipment.

Billing Software and clinical data management systems: A cloud system will be beneficial to cut the cost of expensive servers, IT support services, and other significant operational expenses. Other ways of cutting costs are automated billing, patient booking, e-payment, and data management systems which will reduce the repetitive manual tasks of on-paper filing. In addition, such automated systems give patients a unique experience. Not only patients but also clinicians are benefitted through automated systems. For example, better diagnosis decisions can be taken through e-recommendation systems in the software.

4. Regulatory permissions and compliance

The Clinical Establishments (Registration and Regulation) Act, 2010 has been enacted by the Central Government for the provision of registration and regulation of all clinical establishments in India including single-doctor clinics.

According to this act,

Hospital Level 1(A) includes general medical services along with indoor admission services by MBBS doctors, and dentistry services provided by BDS graduates,

Hospital Level 1(B) includes all services under Level 1(A) and specialist medical services by specialties namely General Medicine, Community Health, Dentistry, General Surgery, Pediatrics, Obstetrics & Gynecology including IPD and OPD services.

Both levels also include supporting services like pharmacy, registration & billing, diagnostic services including laboratory, X-ray, USG, and waste management services including general and biomedical waste management.

Annexure 6 of this act provides the list of legal requirements to be complied with as enlisted below:

Registration under Nursing Home Act/ Medical Establishment Act
Bio-medical Waste Management Licenses, Authorization of HCO by PCB, MOU with Vendor
AERB Licenses (As per AERB regulations)
NOC from Fire Department
Ambulance, Commercial Vehicle Permit, Commercial Driver License, Pollution Control Lice
Building Completion Licenses
Lift license for each lift
DG Set Approval for Commissioning*
Retail and bulk drug license (pharmacy)
Diesel Storage Licenses*
Food Safety Licenses*
Medical Gases Licenses/Explosives Act*
Clinical Establishments and Registration (if applicable)
Blood Bank Licenses
MoU / agreement with outsourced human resource agencies as per labor laws
Spirit License
Electricity rules
Provident fund/ESI Act
MTP Act
PNDT Act
Sales Tax registration
PAN
No objection certificate under Pollution Control Act (Air/Water)
Arms Act, 1950 (if guards have weapons) as per regulations of the state

5. Clinical Equipment Management

Depending on the size of the hospital and specializations, the type of equipment required has to be decided. Before installation of any equipment or software, undertake a cost-benefit analysis for understanding the need and cost-effectiveness of the product. Select the updated versions of the products so as to avoid any kind of configuration issues.

Some of the emergency equipment required by a hospital is enlisted below:

Resuscitation equipment including Laryngoscope, endotracheal tubes, suction equipment, xylocaine spray, oropharyngeal and nasopharyngeal airways, Ambu Bag- Adult & Paediatric (neonatal if indicated)
Oxygen cylinders with flow meter/ tubing/catheter/face mask/nasal prongs
Suction Apparatus
Defibrillator with accessories
Equipment for dressing/bandaging/suturing
Basic diagnostic: Digital Blood Pressure Apparatus, Stethoscope, weighing machine, Digital thermometer
ECG Machine
Nebulizer with accessories
Pulse Oximeter

6. Team management

Hiring a skilled team who are patient-centric and dedicated towards better health outcomes is quintessential for any medical practice. The team should be digitally savvy and inspired to learn technology to ensure a smooth transition from traditional to modern care.

It is necessary that the clinical staff including doctors, nurses, and technicians are qualified and registered. These can be verified by performing a background check on the employees for the safety of the hospital.

The software system utilized should be efficient to manage the staff and schedule, so as to achieve work flexibility along with efficiency. There should be a dedicated marketing professional who continuously generates awareness about your clinic in the market through various digital platforms.

7. Risk Management

It is necessary to perform routine preventive and corrective maintenance wherever required to minimize risks and harm to patients, staff and yourself. This can be regularly done by the risk management cycle.