From OT to Pharmacy: Full Cost Planning Guide for Nursing Homes in India
Table of Contents
Introduction
Starting and operating a nursing home in India requires strategic cost planning across departments, from the **Operation Theatre (OT)** to the in-house **pharmacy**.
Each component comes with its own set of fixed and recurring costs, and understanding these can make the difference between a financially sustainable facility and one that struggles to survive.
In this guide, we present a comprehensive breakdown of setup and operational costs involved in establishing a modern nursing home in India, along with budgeting tips to help maintain efficiency and profitability.
1. Nursing home–Land, Building, and Infrastructure
A. Land/Building Costs
*Purchase: ₹10,000–₹50,000 per sq ft in urban India.
*Rent: ₹50,000 to ₹5,00,000/month depending on city and square footage.
B. Renovation & Interiors
* Costs vary with facility size and standards.
*Budge: ₹5 lakh to ₹50 lakh for interiors, flooring, lighting, partitions, and signage.
2. Nursing home – Licensing, Approvals, and Compliance
*Regulatory Licenses: Trade license, Clinical Establishments registration, Biomedical Waste, Fire Safety, Pollution Control.
*Cost: ₹50,000 to ₹7,00,000.
*Annual Compliance: Includes renewals and documentation.
3. Operation Theatre (OT) Setup
A. Setup Costs
* OT Equipment: ₹10 lakh – ₹50 lakh.
* Includes OT tables, surgical lights, anesthesia workstations, suction, monitors, autoclaves.
B. OT Running Costs
*Annual: ₹10 lakh to ₹30 lakh, depending on complexity.
*Consumables: Up to 30% of OT expenses (surgical kits, gloves, drapes).
C. Example Benchmark
* JPNATC, New Delhi: ₹1.97 crore/year with ₹22,627 per OT hour for tertiary care.
* Scaled-down version for nursing homes: ₹1 lakh – ₹3 lakh/month.
4. Ward and Patient Care Areas
A. Infrastructure
* Beds: ₹5,000 to ₹20,000 per bed.
* Nursing Station Setup: ₹2 lakh to ₹10 lakh depending on bed count.
* Furniture, curtains, mattresses, bed lifts: additional ₹2 lakh to ₹5 lakh.
B. Monthly Operational Costs
* Cleaning supplies, PPE, and patient monitoring.
* Budget: ₹1 lakh – ₹2 lakh/month.
5. Pharmacy Setup
A. Initial Investment
* Fixtures, licensing, POS system, and starter stock: ₹5 lakh – ₹15 lakh.
* Licensing: ₹50,000 – ₹1 lakh for drug license and GST.
B. Monthly Operating Cost
* Inventory replenishment: ₹2 lakh – ₹5 lakh.
* Pharmacist salary: ₹20,000 – ₹50,000.
6. Medical Equipment & IT Systems
A. Equipment
*Oxygen concentrators, ECGs, defibrillators, and patient monitors.
*Budget: ₹5 lakh – ₹20 lakh.
B. IT Systems
* Hospital Management Software (HMS), servers, security.
* Cost: ₹1 lakh – ₹10 lakh.
* Networking & Security: ₹50,000 – ₹3 lakh.
7. Staffing
A. Manpower Structure
* 2 to 3 staff per bed.
* For a 20-bed facility: approx. 40–60 staff (doctors, nurses, aides, admin, support).
B. Salaries
* Range: ₹3 lakh to ₹10 lakh/month.
* Staff costs contribute 50–60% of the monthly operational budget.
8. Operating Costs (Monthly & Annual Estimates)
Expense Category | Monthly Estimate (₹) | Annual Estimate (₹) | Notes |
Staff Salaries | 3–10 lakh | 36–120 lakh | 50–60% of total ops cost |
OT Supplies/Running | 1–3 lakh | 12–36 lakh | Includes sterilization, disposables |
Utilities | 30,000–1 lakh | 3.6–12 lakh | Electricity, water, gas |
Food & Nutrition | 1–2 lakh | 12–24 lakh | ₹10–₹15 per patient/day |
Maintenance | 20,000–80,000 | 2.4–9.6 lakh | Cleaning, repairs |
Insurance | 10,000–80,000 | 1.2–9.6 lakh | Liability, fire, property |
Transportation | 10,000–30,000 | 1.2–3.6 lakh | Ambulance & patient movement |
Admin/IT/Software | 50,000–2 lakh | 6–24 lakh | Billing, HMS, compliance |
Pharmacy Inventory | 2–5 lakh | 24–60 lakh | Monthly replenishment | |
9. Budgeting & Financial Planning Tips
*Track Costs by Unit: Separate budgeting for OT, pharmacy, wards, and admin helps control leakage.
*Review Staffing Regularly: Match headcount to occupancy to avoid overstaffing.
*Bulk Procurement: Negotiate with suppliers to get discounts on regular-use consumables.
*Energy Saving: Switch to LED, solar, or energy-efficient cooling for long-term savings.
*Food/Housekeeping: Opt for annual contracts to save on food and facility maintenance.
10. Summary Table: Cost Breakdown for Nursing Home (India, 2025)
Area/Function | Initial Setup (₹) | Monthly Operating (₹) |
OT | 10–50 lakh | 1–3 lakh |
Pharmacy | 5–15 lakh | 2–5 lakh |
Wards/Patient Care | 5–20 lakh | 1–2 lakh |
Medical Equipment | 5–20 lakh | 50,000–1 lakh |
IT & Security | 1–10 lakh | 10,000–50,000 |
Licensing/Compliance | 1–7 lakh (annualized) | — |
Staff Salaries | — | 3–10 lakh |
Utilities | — | 30,000–1 lakh |
Food/Nutrition | — | 1–2 lakh |
Maintenance | — | 20,000–80,000 |
Insurance/Admin | — | 60,000–2.8 lakh |
Conclusion
Running a nursing home requires detailed planning and cost control across multiple departments, including **Cost Planning for OT, Ward, Lab, and Pharmacy**. By segmenting expenses, planning budgets department-wise, and monitoring operational efficiency, nursing homes in India can offer quality care while remaining financially sustainable.
From infrastructure to staff, every rupee counts. With consistent audits, negotiation, and system optimization, you can build a nursing home that is both patient-centric and profit-ready.
FAQs
**Q1. What is the total cost to set up a nursing home in India?**
The initial setup can range from ₹1 crore to ₹4 crore+, depending on location, size, and services offered.
**Q2. Which department is the costliest to operate?**
Staff salaries and medical supplies are the largest recurring expenses, followed by OT and pharmacy operations.
**Q3. What licenses are needed to start a nursing home?**
Clinical Establishments Act registration, Fire Safety, Pollution Control, Drug License (for pharmacy), Trade License, and Insurance.
**Q4. Can I run a nursing home in a rented building?**
Yes. Many mid-sized facilities operate on leased premises with necessary structural and compliance upgrades.
**Q5. How can I reduce monthly expenses?**
Bulk purchases, outsourcing non-core services, using efficient energy systems, and automating billing/records can reduce costs.
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