Regulations & Procedure to Start a Hospital in Pakistan

Population of Pakistan has been increasing with the greater percentage. It has become very difficult for the Government to provide health facilities to large number of population. This arise a strong need of private hospitals with modern technology and better infrastructure.

This article provides guidelines, requirements & procedure for setting up a private hospital in Pakistan. The project is having a capacity of 25 private rooms, 10 beds for general ward, 10 beds for labor ward, 5 bed for ICU / CCU, and 10 beds for emergency. The outdoor facilities would include a diagnostic clinic consisting of a complete medical laboratory and a radiology department. For this project it is recommended to construct or acquire a purpose built building at main location of the city, particularly in densely populated areas.

The total estimated investment required to start a hospital in Pakistan is Rs. 135.83 million including a capital cost and working capital of Rs. 134.50 million and Rs. 1.33 million respectively. Projected IRR, NPV and Payback period for the proposed project are 40%, Rs. 223.52 million and 3.42 years respectively. The project will provide direct employment opportunities to 162 persons including medical and non-medical staffs.

Availability of reputed consultants play a major role in the success and popularity of private hospitals. It is suggested that consultants from a wide range of specialties should be attracted for the hospital. The key success factor in this business is the availability of renowned consultants in the hospital. The consultants are the main reason for good patient base of the hospital.

This hospital would be a general hospital catering both, indoor and outdoor patients. The indoor facilities mainly include Emergency, ICU / CCU, Rooms, General Ward, and Labor Ward with a fully functional operation theater capable of conducting major types of surgeries. The outdoor facilities would comprise of a diagnostic clinic consisting of a complete medical laboratory and a radiology department. According to the stated medical facilities, proposed hospital mainly comprised of the following sections:

  • Emergency Department
  • Out Door Patient Department
  • Diagnostic Center
  • Radiology Department
  • Surgical Consultancy
  • Medical Consultancy
  • Gynecology and Obstetrics

Operational Capacity of Hospital

The proposed hospital will have an overall capacity of providing medical facilities to 27,300 patients in Year 1. The patient’s occupancy in starting year is estimated at 60%with an annual increase of 10%. However, provision of medical services will vary in terms of different medical services.

Growing number of patients and lack of maintained infrastructure has put tremendous pressure on public sector hospitals. This has resulted in a rising demand for health care services in the private sector across the country. Moreover, introduction of latest technology, hygienic environment and professional staff attitude at private sector hospitals has also contributed to the popularity of the hospitals in private sector. Investors in the private sector can therefore exploit this opportunity in all the major urban and peri-urban cities of Pakistan.

However it is pertinent to highlight that, large public sector hospitals are mainly concentrated in major cities of the country. Therefore, it is suggested that new hospital should be opened up either in smaller cities, peripheral areas or in those areas of the larger cities where there is little presence of existing medical facilities. In this regard newly developed or developing housing societies could be most appropriate locations for the hospitals. But selected location should be easily accessible and has considerable population concentration.

From 1981 to 2013, the estimated population of Pakistan has grown from 85 million to 180 million making Pakistan the seventh most populous country in the world. This growth rate of population has posed tremendous challenge to the existing infrastructure for basic health facilities in the country. Growing population, increasing industrialization, resultant high level of environmental pollution, and increased healthcare awareness has specially stretched the existing public health care system in the country. This has given rise to high demand of private sector health care facilities to complement its public sector counterpart. The major target market for the facility consists of residential areas in the vicinity of the hospital. The basic services that will be provided will also be determined by the need of the locality and its adjacent areas.

Factors for Success of a Hospital in Pakistan

Following are the factors critical for the success of hospital business in Pakistan:

  • Engagement of well-reputed consultants from wide range of multidisciplinary diagnostic and medicinal areas
  • Appointment of trained, highly skilled and professional Paramedical Staff
  • Maintaining high standard of patient care, comfortability, and hygienic environment for the patients; trained and courteous nursing and other administrative staff is strongly required for customer satisfaction
  • Modern and reliable diagnostic services which would include a fully equipped Radiology Department consisting of X-Ray, ECG and Ultra Sound Equipment and a dependable Medical Laboratory for routine medical examinations.
  • Formation of organizational system especially for creating integration among different departments and diagnostic operations
  • Establishing strong linkages with suppliers for sourcing quality medical supplies on time couple with economical prices
  • Reasonable and competitive fees, positioned against competitors fees
  • Location considerations for easy access of the patients
  • Careful market analysis of the surrounding population should be carried out before determining the services to be provided in the hospital

Land & Building Requirements for Hospital in Pakistan

Approximately 1.5 kanal of land would be required for establishment of the proposed size of hospital; it is recommended that required land should be procured in the vicinity of populated residential societies. The cost of land is estimated at a rate of Rs. 20.00 million per kanal, therefore total cost of required land is Rs. 30.00 million. The infrastructural requirements of the project mainly comprises of the construction of Emergency, ICU / CCU, Diagnostic Center, Radiology Department, Surgical Consultancy, Medical Consultancy, Gynecology and Obstetrics, Canteen, Pharmacy, waiting areas, parking space and open space, etc.

Machinery & Equipment Requirement for Hospital in Pakistan

Radiology Department Machinery & Equipment

  • X-Ray Apparatus with Motorized Tilting Table
  • Dark Room X-Ray Accessories
  • ECG Machine
  • Ultrasound Machine
  • Printer for Ultrasound

Diagnostic Center Machinery & Equipment

  • Blood Analyzer
  • ELISA for Hormone Analysis Fully Automatic
  • Binocular Microscope
  • Centrifuge Machine
  • Clinical Water Bath
  • Photo Calorimeter
  • Lab Incubator
  • Miscellaneous Lab Equipment
  • Chemistry Analyzer

Operation Theater Machinery & Equipment

  • Operation Theater Shadow less Light
  • Electric suction apparatus
  • Surgical Diathermy
  • Anesthesia Apparatus
  • Trolley for Anesthesia
  • Cardiac Resuscitation Trolley
  • Cardiac Monitor
  • Hydraulic Operation Table
  • Horizontal and Vertical Autoclave
  • Operation Table
  • Emergency Oxygen Kit

Gynecology, Obstetrics and Pediatrics Machinery & Equipment

  • Operation Theater Shadow-less Light
  • Electric Suction Apparatus
  • Delivery Table
  • Computerized Baby Incubator
  • Photo-therapy Apparatus
  • Baby Cot with Side Protection

ICU/CCU Machinery & Equipment

  • Ventilator
  • Cardiac Monitors
  • Arterial Blood Gas Analyzer

Other Machinery & Equipment for Hospital

  • Instrument sterilizers
  • Baby Weighing Machine
  • Instrument cabinets
  • Stethoscope
  • IV Stands
  • Blood Pressure apparatus

Consultants Required for Hospital in Pakistan

Consultant services for the following specialized areas would be made available in the hospital:

  • Gastroenterology Specialist
  • Pediatric Physician
  • General Surgeon
  • General Physician (Chest & TB)
  • Diabetes & Endocrinologist
  • Cardiologist
  • Orthopedic Surgeon
  • Gynecologist
  • Pathologist
  • Dentist

Investment Required to Setup a Hospital in Pakistan

All the figures in this financial model have been calculated for providing different medical care facility to around 27,300 patients in the year one, followed by a subsequent increase of 10% annually. The patient occupancy in year 1 is estimated at 60%. For a detailed financial study, please refer to the pre-feasibility study of a hospital business in Pakistan by SMEDA.

Rules, Regulations & Requirements to Start a Hospital

The doctors working in the hospital should be registered with the Pakistan Medical and Dental Council (PMDC). Prior sanction / approval from the government through Pakistan Atomic Energy Commission (PAEC) is also required in case of the equipment being installed in the hospital such as X Ray machines, as they emit radiation and has to be sanctioned / approved.

Procedure to Get License & Registration of Hospital in Pakistan

A healthcare service provider (hospital) shall not provide healthcare services without being registered under the following regulations:

  • A person seeking to be registered as a healthcare service provider (hospital) shall make an application to the Commission in the prescribed form and accompanied by such particulars, documents as the Commission may prescribe.
  • An existing healthcare service provider shall, within a period of ninety days of the coming into force of this Act, apply for registration in accordance with this section and the regulations.
  • If a person fulfills the requirements of this section, the Commission shall issue a certificate of registration to the person within fourteen days otherwise the applicant shall be considered as having provisionally registered.
  • The Commission may impose a fine which may extend to five hundred thousand rupees upon a healthcare service provider or who pretends to be a healthcare service provider without registration.
  • A healthcare establishment shall not be used except in accordance with the terms and conditions of a license issued by the Commission.
  • If a healthcare establishment is not licensed under this Act, the Commission may impose a fine which may extend to five hundred thousand rupees upon the healthcare service provider.
  • In case of shifting of a healthcare establishment, the license issued earlier under this Act shall be valid but the healthcare service provider shall inform the Commission prior to the shifting of the healthcare establishment.

Application for Licenses of Medical Facility in Pakistan

Within thirty days of the issuance of the certificate of registration or such other time as may be fixed by the Government, the healthcare service provider shall make an application for a license to the Commission in the prescribed form which shall be accompanied by such particulars, documents and fees as the Commission may prescribe.

Licensing Procedure of Hospital in Pakistan

The Commission shall, on receipt of an application, complete with all required documents under section 15, issue a provisional license to the healthcare establishment and shall, within the period of thirty days from the date of acceptance of the application, issue the regular license to the healthcare establishment. The Commission may, before issuing the license, inspect the healthcare establishment which is to be licensed, or cause such healthcare establishment to be inspected by an inspection team. A license issued by the Commission under this section:

  • Shall be in such form as may be prescribed
  • Shall be valid for the period of five years
  • May be renewed upon expiry.

Types of Healthcare Licenses in Pakistan

  • Every license of a healthcare establishment shall specify the kind of healthcare establishment for which it is issued and the purposes of the healthcare establishment.
  • A licensed healthcare establishment shall not be used for any purpose other than the purposes in respect of which the license is issued and purposes incidental to such purposes.
  • The Commission shall maintain a register of all licensed healthcare establishments and may enter in the register any necessary details or other particulars of the healthcare establishments

Suspension of Hospital License

The Commission may revoke a license if the license has been obtained by fraud or misrepresentation. The Commission may suspend a license of a healthcare establishment if repeated cases of medical negligence of same nature have proved against the healthcare establishment.

Subject to sub‐section (2), a healthcare service provider may be held guilty of medical negligence on one of the following two findings:

  • The healthcare establishment does not have the requisite human resource and equipment which it professes to have possessed
  • He or any of his employee did not, in the given case, exercise with reasonable competence the skill which he or his employee did possess.

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