This paper aims to develop a reliable and valid CRM (Customer relationship management) Index specifically catering to Indian hospitals. Standard method of scale development was followed by case based method for development of CRM Index. The proposed scale shows CRM in Indian hospitals as a multidimensional construct comprising of factors namely tangibles, service quality, trust, availability and accessibility which is validated through the structural model. The proposed Index will help in identifying issues that contribute to CRM in Indian hospitals and formulate strategies accordingly, resulting in efficient (cost) and effective (outcomes) practices. A fair amount of literature on Indian hospitals dealt with identifying factors explaining the constructs of quality, value or satisfaction. There is paucity of research pertaining to industry specific CRM Index development and validation and the authors attempt to bridge this gap in the existing literature.