An aged care emergency department at Bulli would ease the pressure on Wollongong Hospital and stop elderly people waiting in corridors for hours on end.
Illawarra Shoalhaven Local Health District board chief Denis King said expansion plans for Bulli Hospital would include an aged care emergency service from next year.
That is in addition to the existing emergency primary health care centre, which would operate from 7am to 10pm.
"People in nursing homes who are not necessarily very well get relatively minor problems sometimes, but they require care out of hours and they require a level of hospital care," Professor King said.
"They tend to come in ambulances to the Wollongong ED at the moment.
"Because their problems are often relatively minor they tend to go to the back of the queue and they sometimes sit on stretchers in corridors for days," he said.
"What we are proposing is to change the policy to have a triage policy that will see those people taken to an enhanced aged care facility at Bulli," he said.
Professor King said the patients would be "managed in a facility that more suits what they need".
"It fixes several problems and we anticipate that will be starting next year."
The Save Bulli ED lobby group said the aged care emergency department - which was an addition to the existing level of emergency care - was a gain for the northern Illawarra.
"But we have a long way to go before our community needs are adequately met," convener Alison Fettell said.