The treatment cost of biomedical waste (BMW) is a limiting factor for all the hospitals due to resource crunch. Therefore to minimize the BMW and to contain the costs are the only solutions. As recycling is not permitted under the Biomedical Waste Management (BMW) Rules, cost-benefit analysis is not possible also. BMW management on outsourced system, but under the supervision of hospital staff, is still the best option. The present model has been prepared by taking the reference of U.P. Health System, Development Project, Lucknow, India, to achieve the cost-benefit/containment while treating the BMW. The cost of in-house treatment facility was calculated and was compared with cost of treatment if it was outsourced. The cost of in-house treatment comes to Rs. 19.50 per bed/day whereas in case of outsourcing it is Rs. 17.50 per bed/day for a hospital ranging from 250-600 beds (with 80% bed-occupancy rate). Thus Rs. 157,500 can be saved per year (Rs. 157,5000.00 in 10 years) on the basis of Rs. 2.00 per bed/day saving. This model is under consideration for implementation at the Sanjay Gandhi Post Graduate Institute of Medical Sciences, Lucknow, India.