The paper is concentrated over the fact that the hospitals need to increase the revenue by increasing the outpatient rate. In order to do so, the hospitals need to increase the customer satisfaction by improving the service quality. The research is reliant over the fact that the components of the service quality play an important role in improving the customer satisfaction. The paper states that the loyalty of the patients is developed through the experiences of the patients whether it is bad or good (Molina et al. 2007). Loyalty is considered to be the last and final stage of the consumer behaviour. If the customers remain loyal, they will not shift to the other products or services. In the context of the service providing companies, it is quite difficult to maintain and provide customer satisfaction. On the other hand, the service quality affects the satisfaction of the consumers and hence in order to provide customer satisfaction, the hospitals need to improve their service quality.
The aims of this paper are to evaluate the impact of service quality on customer satisfaction, evaluate the impact of satisfaction of the patients over consumer loyalty and finally to investigate the impact of service quality on patient loyalty. The research work is conducted on the basis of multiple regression analysis of the dimensions of service quality and a Structural Equation Model for the analysis of the selected variables associated with service quality and customer satisfaction towards loyalty. The paper defines customer satisfaction as a cognitive situation of the buyer on the gap between the sacrifices made and the value acquired. Customer loyalty is fidelity and it is observed that the customer’s loyalty develops on the basis of the previous experience. The findings of the paper portrays the fact that quality of service along with all of its dimensions can both directly and indirectly impact on whether the customers will return to the hospital when they are in need of medical services or not. The managerial implication of the findings suggests that the hospital should look forward to improve the service quality and thereby improve the patient’s satisfaction level. Accessibility to the hospital could be improved by providing an alternative road to the hospital, constructing a parking area and controlling the area of interest around the hospital.