Legal Approvals Required To Run A Clinic Or Hospital In India

In today’s legal landscape, commencing a private practice as a healthcare service provider — be it a small clinic, individual practice, diagnostic services, a single speciality hospital or a multi-speciality hospital — attracts licensing and compliance requirements. As a first step, before starting a clinic/hospital, it is imperative for you to be aware of the various legal requirements. You can see below a list of the licenses you need, and a few guidelines one must comply to, so you can stay on the right side of the law.

That’s why, before starting any business, one may consider Legal Compliance Management Company. They give proper guidance, legal and compliance auditing services, and handle everything through a legal and regulatory compliance software.

These compliance requirements may vary depending on the services you offer. Say, for example, if you are a dentist with an X-ray machine, then you will need to obtain a registration for using the X-Ray. Similarly, the type of services you deliver typically enhance your various licenses.

The reference below mentions licenses for different health care services/speciality under relevant laws:

Service License Under:
Ultrasound scanning Prenatal Conception and Pre-natal Diagnostics Techniques Act, 1994
Admission of Physicatric Cases Mental Health Act, 1987
Selling Medicines/ Drugs Drugs and Cosmetics Act, 1940
Transplantation of Human Organs Transplantation of Human Organ Act, 1994
Scan centres having X-RAY, CT, PET-CT etc Atomic Energy Regulatory Board
Blood bank/ Blood Storage Center Drugs and Cosmetics Act, 1940

Besides the above laws, your clinic/hospital will also need to adhere to the Clinical Establishment Act, pollution control norms, fire safety norms, and other central and state-specific labour laws. Here is a list of licenses you will need for the infrastructure you use for the clinic/hospital:

Approvals Relating To Infrastructure

For each speciality you offer, the space requirement will be multiplied and governed under their respective laws.

In order to run a small clinic, you will need a consulting room of a minimum 100 square feet. Naturally, depending on the services you render, the space requirements will also change. Keep in mind, for each speciality you offer, the space requirement will be multiplied and governed under the respective laws as aforementioned.

The basic approvals required for the building, if owned by you, is:

  1. Occupancy certificate.
  2. Completion certificate.
  3. Fire NOC, if the building where the clinic/ hospital is established is more than 15 meters tall.

If the building/space is taken on lease/rent, then you will need a lease deed/rent agreement, which shall be renewed on the expiry of the lease. Also, ensure that the owner has obtained the above-mentioned approvals for the building.

Clinical Registration

Irrespective of whether you are a small single practitioner clinic or a multi-speciality hospital, you need a registration certificate under Clinical Establishments (Registration and Regulation) Act, 2010. Each state passes its own rules, and accordingly, the procedure followed for obtaining the license also varies.

Pollution Approvals

You will need to obtain consent from the State Pollution Control Board for the generation of bio-medical waste, if your clinic/ hospital generates any waste such as soiled waste, linens, sharp waste, etc. This authorisation is given for a non-bedded category i.e if you only offer outpatient consulting. Typically, such authorisations are valid until revoked, i.e for lifetime. However, if there is any change in the quantum of waste being generated, then a revised approval has to be obtained. Apart from this, you will need consent to establish and consent to operate the hospital from the Pollution Control Board depending on the bed size.

Approvals Related To Medical Professionals And Employees

Besides approvals and licenses for the clinic, the doctor, nurses and other medical professionals you employ also need to have the right registration, such as:

  1. State Medical Council Registration for doctors.
  2. Nursing Council Registration for the nurses employed.
  3. Dental Council Registration, for the dentists.
  4. Pharmacy Council Registration for Pharmacists.
  5. Registration of clinical psychologist, if it is a psychological clinic.

Drug License

If your clinic/hospital has an attached pharmacy, or you dispense drugs to your patients from your clinic/hospital, then you need:

  1. License for retailing drugs obtained from the Drug Controller under Drugs and Cosmetics Act, 1940.
  2. If the clinic/hospital uses or dispenses narcotics drugs in the form of injection or tablets or patches, then special approval from the district collector has to be obtained.

Above all, if you have put in the work, and obtained the licenses, display them.

Here the thumb rule is, when in doubt, just display. You may display all the licenses you obtain. Every clinic/hospital must display:

  1. The registration certificate under the Clinical Establishments Act.
  2. Registration Certificate of the Doctors under the Indian Medical Council.

Apart from obtaining the approval, you will need to maintain some mandatory records under the law, such as:

  1. Record of employment of adults, letters of employment issued and hours of work
  2. Records regarding the treatment of patients (IMC Regulations 2002)
  3. Register of medico-legal cases (MLCs)
  4. Register of medical certificates issued to patients
  5. Copies of medical certificates issued to the patients
  6. Registration certificates of doctors/nurses/pharmacists with the Indian Medical Councils (IMCs)
  7. Professional qualification certificates (degrees/diplomas) of the staff
  8. Record of consumption of morphine, vermin other narcotic drugs (if applicable) (Narcotic Drugs Rules, 2002)
  9. The account of money receipts and expenses (Income Tax Act, 1961)
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