Doctors have warned a special commission of inquiry into health funding in New South Wales will result in hospital cuts.
Senior barrister Richard Beasley SC has been appointed to lead the 12-month special commission of inquiry into healthcare funding — which exceeds $30 billion each year.
Health Minister Ryan Park on Thursday said it would take a forensic look at where the billions of dollars were being spent and crack down on wasteful spending.
"Making sure that every single dollar we spend is directed to where it's needed most," Mr Park said.
"That means it's good for patients, it's good for staff and it's good for the system and the community and that's what we're focused on, improving what is already a very good system."
It comes amid tense wage negotiations with health unions, and increasing pressure on emergency departments.
Labor promised to hold the inquiry in the lead-up to the state election, but doctors' groups have criticised it as an attack on the state's hospital system.
Doctors fear cuts to frontline services
Australian Medical Association NSW president Michael Bonning said he was concerned it would focus on directing resources away from public hospitals into other parts of the system.
"What we're seeing is the state now starting to say that we can fix public hospitals by taking money out of them and putting them elsewhere, we don't agree with that," Dr Bonning said.
"We don't need another inquiry, we need to ask clinicians on the ground what gets the job done and they'll be able to tell us."
Dr Bonning said he was also concerned millions of dollars that could be spent on frontline care were being spent on an inquiry.
"There are tens of thousands of people every quarter who aren't seen in time in emergency departments, you need to put that funding into frontline doctors and nurses to achieve better health outcomes," he said.
But Mr Park said any money saved through the inquiry would be directed back into the system.
"This is a once-in-a-lifetime opportunity to change, reform and enhance one of the biggest health systems in the world and certainly one of the biggest in the southern hemisphere," he said.
The NSW Opposition also criticised the inquiry, saying it was the 22nd review announced by the government since coming to power.
Shadow Health Minister Matt Kean said a review wasn't needed to confirm the health system was in crisis.
"Health workers have been walking off the job because (NSW Premier) Chris Minns broke his promises that he made to them," he said.
Health union welcomes forensic look at funding
The Health Services Union (HSU), which has been leading the negotiations with the government over wages, welcomed the special commission of inquiry.
HSU secretary Gerard Hayes said health care funding accounted for nearly a third of the state budget and needed to be scrutinised.
"The people that we represent are not taking all the money in the health system," Mr Hayes said.
"It's other areas that systems need to be looked at, they have never been looked at. I think the last royal commission into health was 1929."
Mr Hayes said the federal government should also contribute to the NSW inquiry, arguing cost shifting had meant 10 per cent of public hospital beds were being used for aged care patients and National Disability Insurance Scheme participants.
The inquiry is due to report its findings by August next year.