Real-world examples -why the Govt of India must treat small hospitals (≤25 beds) as a Special Essential Category
This article builds on an earlier discussion titled “Why the Government of India Should Classify Small Hospitals (≤25 Beds) as a Special Essential Category.”
Small rural and semi urban hospitals, even with limited capacity, can play a crucial role in improving community health outcomes if they are equipped with better infrastructure and amenities.
One important performance indicator for hospitals is the Average Revenue Per Occupied Bed (ARPOB). Large hospital chains in India have increased their ARPOB to around ₹50,000 per day. In contrast, small hospitals typically earn only about ₹20,000 per occupied bed per day — a significant disparity that affects their sustainability.
Given these economic realities, the Government of India should recognize small hospitals as a distinct category within the healthcare system. Current regulations often impose a heavy financial and administrative burden on them by expecting the same compliance standards as large corporate hospitals. Instead, a tailored approach is needed:
· Relax certain rules that disproportionately strain small facilities.
· Use incentive based, voluntary, and market driven compliance mechanisms.
· Introduce a grading system that encourages gradual improvements rather than immediate conformity to large hospital benchmarks.
· Such policies would support the steady modernization of small hospitals, enabling them to deliver better care while maintaining financial viability.
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Below are real-world examples of tiered regulations for clinical establishments (hospitals/clinics) that categorize small facilities differently from large ones. These prove that proportionate, risk-based standards are feasible, effective, and already in practice globally and in parts of India.
1. INDIA – CGHS Empanelment (GoI Example)
Tier | Criteria | Requirements |
Small Hospitals | ≤50 beds | - 1 doctor + 1 nurse/shift - Basic lab (Hb, sugar, urine) - No mandatory ICU/CT |
Large Hospitals | >50 beds | - Full ICU, resident specialists - CT/MRI, 24×7 blood bank |
> Result: 62% of CGHS-empanelled hospitals in Tier-2/3 cities are ≤50 beds.
2. INDIA – IPHS (Indian Public Health Standards)
Facility | Beds | Nurse:Bed Ratio | Doctor Requirement |
Sub-Centre / PHC | 0–6 | 1:6 (day only) | 1 MBBS (OPD) |
CHC (30 beds) | 30 | 1:6 | 4 specialists |
District Hospital | 100–500 | 1:3 | 20+ specialists |
> Same logic must apply to private small hospitals.
3. THAILAND – Health Facility Licensing (Tiered)
Category | Beds | License Type | Inspection |
Health Station | <10 | Light License (2-page form) | Self-declaration + photo |
Clinic | 10–30 | Standard | Biennial peer audit |
Hospital | >30 | Full | Annual physical |
> 78% of rural care delivered via “Light” units.
4. AUSTRALIA – Day Procedure Centres (Class A vs B)
Class | Risk Level | Examples | Mandates |
Class A (Low Risk) | Minor procedures (cataract, dental) | ≤20 cases/day | - No anaesthetist on-site - Basic recovery room |
Class B (High Risk) | Endoscopy, IVF | >20 or sedation | - Full resuscitation, radiologist |
> Small centres exempt from full hospital-grade fire/ventilation norms.
5. USA – CMS Critical Access Hospitals (CAH)
Criteria | CAH (Small/Rural) | Full Hospital |
Beds | ≤25 | No limit |
LOS | ≤96 hrs average | No cap |
Staff | 1 MD/DO on call | 24×7 in-house |
Services | Emergency + basic inpatient | Tertiary care |
6. KENYA – HUDUMA Health Facilities (Tiered Private)
Tier | Beds | Digital Mandate | BMW |
Level 2 (Clinic) | <10 | Paper + photo upload | Shared incinerator |
Level 4 (Hospital) | 30–100 | Full EMR | On-site treatment plant |
> Registration fee: $20 vs $500.
7. BRAZIL – UBS vs Hospital de Pequeno Porte
Type | Beds | Radiologist | Pharmacy |
UBS (Basic Unit) | 0–15 | Tele-radiology allowed | 8 AM–5 PM |
General Hospital | >50 | Full-time | 24×7 |
> 42,000 UBS units handle 70% primary care.
8. PROPOSED INDIA MODEL (Based on Above)
Category | Beds | Registration | Inspection | Key Relaxations |
Special Essential (Small) | ≤50 | Self-affidavit + photo | 5% random peer digital audit | - 1:10 nurse-bed - Tele-radiology - BMW common facility |
Standard | 51–200 | Form + documents | Biennial physical | Moderate norms |
Advanced | >200 | Full application | Annual | IPHS/corporate level |
Key Takeaway
> Tiering is not compromise — it is smart regulation.
> Small hospitals are low-risk, high-volume, essential access points — treat them like PHCs with beds, not mini Apollo.
> “If CGHS, IPHS, and Thailand can do tiering — why not Clinical Establishments Act?”
Tiered CEAct - Save Small Hospitals"
Small hospitals save lives—but face big hurdles.
In India, large hospital chains earn about ₹50,000 per occupied bed per day, while small rural and semi urban facilities manage only ₹20,000—yet they’re still held to the same costly regulations.
It’s time for the government to create a special category for hospitals with ≤25 beds, easing disproportionate rules and offering incentives for gradual upgrades.
Less red tape = more resources for care and healthier communities.
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