Upper Hunter Nationals MP Dave Layzell said the project will consolidate all acute clinical services into the one building to provide state-of-the-art health facilities and enhanced health services.

"This redevelopment will provide the Upper Hunter community with quality health care closer to home and ensure better health outcomes for our region's needs now and into the future," Mr Layzell said.

"The next stage of this hospital redevelopment will deliver a new inpatient unit, operating suite and sterilising services department, and also house maternity and birthing services within the main building.

"It will also provide eight new overnight rooms for staff providing comfort, convenience and security for staff who require accommodation."

Mr Layzell encouraged the Muswellbrook community to have their say and provide feedback on the concept design. An information session involving representatives from Health Infrastructure and Hunter New England Local Health District will be held at the Muswellbrook Workers Club on Friday, June 24 from 12:30-2pm.

"We're encouraging the local community to have their say and provide feedback, which will help inform the planning and design of this hospital," Mr Layzell said.

NSW Minister for Regional Health and Mental Health, Bronnie Taylor said the third stage of the redevelopment would significantly improve workflow for staff and facilitate contemporary models of care to ensure a more efficient and sustainable health service.

"Staff will benefit from a better integrated facility and contemporary workspace, while patients, families and carers will feel welcome within the new facility which has been designed to provide a culturally respectful place for treatment and care," Mrs Taylor said.

The NSW Government said the next stage of the redevelopment complements $28 million in health infrastructure upgrades delivered as part of Stages 1 ($6.5 million) and 2 ($21.5 million), which included an upgraded emergency department and other new clinical areas.

Early works to deliver the new operating suite and sterilising department are expected to commence late 2022, with the project scheduled for completion in 2025.

The state government said the Muswellbrook Hospital redevelopment is part of a $10.8 billion investment in health infrastructure over four years to 2024-25, with nearly a third of the capital allocation in this financial year going towards regional and rural health facilities.