Affordable Healthcare Basics – A Financial perspective

1. Preamble

Whether you are planning a new diagnostic centre, doing an exercise for pricing of tests or purchasing new lab equipment, you must do a realistic assessment of what you can realistically offer your patients.  We offer such Healthcare Advisory.

An important component of a cost -effective diagnostic centre is assuring that you have “right-sized” your test menus and equipment to provide quality service in an economical manner.

Here, is where we need to “right-size?” the operations.

When your equipment and test menu range create staffing issues or work overload, and expiration of unused reagents/chemicals/kits happen or when quality control, calibration and downtime maintenance requirements interfere with productivity ….you’ve got problems relating to right-size of operations.

Having a laboratory with excess capacity and operating requirements can first drain vital resources and ultimately bankrupt a diagnostic practice.

In today’s scenario when income from laboratory testing is constantly under pressure, right-sizing your lab means better financial health; optimal resource utilization, and ultimately, better quality service for your valued patients. Hence, a clear need for Healthcare Consulting or Management Consulting in Healthcare. As part of healthcare consulting, India, Africa and GCC a study is done and following are the key observations.

2. Test Total Cost Components

a. Direct Material Costs

Reagents and Chemicals

Consumables like Collection needles, tubes/bottles, Gloves

Quality control material

Calibrator material

Report paper, printing and envelope  & bag costs

b. Direct Labour Costs

Laboratory Staff costs


Registered Medical Doctors – Pathologist/Radiologist

c. Other Overheads

Electricity and water

Administrative staff costs

Management staff costs

Service contracts – AMC/CMC

Patient registration software cost

Premise/facility cost

External Quality Assessment

Instrument amortization over useful life

3. Test MatrixTest Matrix

4. Test Matrix – Cost Features

A typical test in each matrix would have cost components as under:


Sarathy advisory helps top management in right financial strategy, costing and brand strategy of healthcare provider organizations such as hospitals, clinics, medical colleges, diagnostic centers. Sarathy Advisory provides healthcare consulting, India, Africa and GCC and discovers plenty of areas with in the operation and strategic business process for growth and competitive positioning. For more information, please write to

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