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Shellharbour Hospital is set to become a regional hub for medical services on the back of a multimillion-dollar federal government cash injection.
Prime Minister Scott Morrison will visit the Illawarra on Monday - the first of either party leader this campaign - to announce $128 million in federal funding for the redevelopment of the hospital.
The cash is in addition to the state government's $250.6 million commitment, with work on the hospital upgrade already under way.
Mr Morrison said the redeveloped hospital would care for Shellharbour's growing and ageing population, which was forecast to jump by 24 per cent by 2031.
"Our plan for a stronger economy means we can make this $128 million investment to bring the hospital redevelopment to life and deliver world class health services to the region," he said.
"We're giving patients the health care they need closer to home.
"We're backing the health projects that will provide high quality and effective care for the people of NSW."
The hospital currently serves as an active but short-term treatment facility.
It provides onsite emergency services, elective surgical services, general medical, antenatal and primary family health care, satellite renal dialysis, and adolescent and adult mental health services.
The redevelopment would allow the hospital to expand its role as an acute and sub-acute service hub for the southern Illawarra, and also help reduce pressure on Wollongong Hospital, Mr Morrison said.
Gilmore Nationals candidate Katrina Hodgkinson, said the hospital investment would make a "real difference" to the region.
"Shellharbour has both a growing and ageing population and we need to invest in the best local facilities to meet our health care needs," Ms Hodgkinson said.
"The Morrison government is committed to improving health care throughout Australia and building a world class health system."
The Liberal Party's candidate for Gilmore, Warren Mundine, described the funding injection as a "huge boost".
"The population here in the southern Illawarra has increased considerably in the last few years and its essential we continue to invest in services to match our growing community," Mr Mundine said.
The money is a slice of the $534.4 million in new health funding announced by the government during the budget and comes from the $1.25 billion community health and hospitals fund.
Early Shellharbour Hospital redevelopment work began in November - four years, and a full state-government term, after the project was announced.
At the time, the project's estimated finish date was late in 2021.
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