Job losses can't be ruled out as the Southern District Health Board (DHB) tries to rein in a $15 million deficit.
The DHB says it has a three-year plan to clear its deficit, by streamlining services from Otago and Southland.
Chief executive Carole Heatly says the DHB needs to look at providing district-wide services.
"I think there are huge amounts of efficiencies that can be made by doing that, and we can also streamline care and make sure care is delivered much closer to the patient," she told Radio New Zealand.
Ms Healty said that while there won't be cuts to frontline services, backroom redundancies are possible.
"We will protect frontline services at all costs. Where we will make our economies and our savings will be in our backroom functions. The quality and standard of care will not be compromised."
In May, the Southern DHB predicted its deficit would be just over $10m, however, on Thursday it was reported to board members that the figure is now $15m.
Ms Heatly said the increase in the deficit is because of unforeseen one-off expenditures at the end of the financial year and wrongly predicted interest rates.
The Otago and Southland DHBs merged to form Southern DHB in 2010.