diff --git a/README.md b/README.md
index 9a36032..650c88c 100644
--- a/README.md
+++ b/README.md
@@ -19,7 +19,8 @@ resources/
 ├── Questionnaire/
 │   ├── questionnaire1.yaml
 │   ├── questionnaire2.yaml
-│   └── questionnaire3.yaml
+│   └── sudbir/
+│       └── questionnaire3.yaml
 ```
 
 ## Supported operations
diff --git a/fhirsnake/cli.py b/fhirsnake/cli.py
index 282a89d..7db4d87 100644
--- a/fhirsnake/cli.py
+++ b/fhirsnake/cli.py
@@ -70,9 +70,8 @@ def server(host: str, port: int) -> None:
     server.run()
 
 
-def watch(url: str, headers: list[str] | None):
-    headers = headers or []
-    headers = {v.split(":", 1)[0]: v.split(":", 1)[1] for v in headers}
+def watch(url: str, headers_list: list[str] | None):
+    headers = {v.split(":", 1)[0]: v.split(":", 1)[1] for v in (headers_list or [])}
     start_watcher(url, headers)
 
 
diff --git a/fhirsnake/files.py b/fhirsnake/files.py
index f6d7fae..9b9beaa 100644
--- a/fhirsnake/files.py
+++ b/fhirsnake/files.py
@@ -4,38 +4,40 @@
 import yaml
 
 
-def load_resources(abs_path):
+def load_resources(root_path: str):
     resources = {}
 
-    for resource_type in os.listdir(abs_path):
-        if not os.path.isdir(os.path.join(abs_path, resource_type)):
+    for resource_type in os.listdir(root_path):
+        if not os.path.isdir(os.path.join(root_path, resource_type)):
             continue
-        resources[resource_type] = load_resources_by_ids(abs_path, resource_type)
+        resources[resource_type] = load_resources_by_ids(root_path, resource_type)
     return resources
 
 
-def load_resources_by_ids(abs_path, resource_type):
+def load_resources_by_ids(root_path: str, resource_type: str):
     resources = {}
-    path = os.path.join(abs_path, resource_type)
-
-    for filename in os.listdir(path):
-        resource = load_resource(os.path.join(path, filename))
-        if not resource:
-            continue
-        resources[resource["id"]] = resource
+    for abs_files_dir, _, files in os.walk(os.path.join(root_path, resource_type)):
+        for filename in files:
+            resource = load_resource(root_path, os.path.join(abs_files_dir, filename))
+            if not resource:
+                continue
+            resources[resource["id"]] = resource
     return resources
 
 
-def load_resource(path: str):
-    # path: /path/to/resources/Patient/id.json
-    resource_type = path.split("/")[-2]
-    file_name = path.split("/")[-1]
+def load_resource(root_path: str, abs_path: str):
+    path = os.path.relpath(abs_path, root_path)
+    # path: Patient/id.json or Patient/subdir/id.json
+    resource_type, *_, file_name = path.split("/")
+    if "." not in file_name:
+        return None
 
     resource_id, file_ext = file_name.rsplit(".", 1)
+
     if file_ext not in ("yaml", "yml", "json"):
         return None
 
-    with open(path) as f:
+    with open(abs_path) as f:
         if file_ext in ("yaml", "yml"):
             resource = yaml.safe_load(f)
         elif file_ext == "json":
diff --git a/fhirsnake/watch.py b/fhirsnake/watch.py
index 7b32a8b..63fcad1 100644
--- a/fhirsnake/watch.py
+++ b/fhirsnake/watch.py
@@ -12,8 +12,9 @@
 
 class FileChangeHandler(FileSystemEventHandler):
     def __init__(
-        self, external_fhir_server_url: str, external_fhir_server_headers: dict[str, str], *args, **kwargs
+        self, target_dir: str, external_fhir_server_url: str, external_fhir_server_headers: dict[str, str], *args, **kwargs
     ) -> None:
+        self.target_dir = target_dir
         self.external_fhir_server_url = external_fhir_server_url
         self.external_fhir_server_headers = external_fhir_server_headers
         super().__init__(*args, **kwargs)
@@ -28,7 +29,7 @@ def on_modified(self, event):
 
     def process_file(self, file_path):
         try:
-            resource = load_resource(file_path)
+            resource = load_resource(self.target_dir, file_path)
         except Exception:
             logging.exception("Unable to load resource %s", file_path)
             return
@@ -56,7 +57,7 @@ def process_file(self, file_path):
 
 
 def start_watcher(external_fhir_server_url: str, external_fhir_server_headers: dict[str, str]):
-    event_handler = FileChangeHandler(external_fhir_server_url, external_fhir_server_headers)
+    event_handler = FileChangeHandler(RESOURCE_DIR, external_fhir_server_url, external_fhir_server_headers)
     observer = Observer()
     observer.schedule(event_handler, RESOURCE_DIR, recursive=True)
     observer.start()