Whakatāne's mental health facility at the hospital is not at immediate earthquake risk and will keep being used for up to five years.
Te Whatu Ora has given this assessment after it was confirmed GNS Science has mapped the town's main fault line running right under the facility.
Te Whatu Ora said the low probability of an earthquake meant the risk was not imminent.
Although the nearby Kawerau township has been rattled by a swarm of quakes over the weekend, GNS Science duty seismologist John Ristau said these could not be pinpointed to a particular fault line, due to the uncertainties on their location and depth "and partly because even fairly small fractures can host events like this".
"There are many faults and fracture systems mapped in the area, and we cannot pinpoint if any of the earthquakes are occurring on the fault that the hospital is situated on."
The facility is a timber-frame two-storey building with a roof that does not weigh much.
However, it "is considered to present a higher seismic risk in the longer term" because its subfloor and foundation are vulnerable, the health agency said.
"As these cannot practically be mitigated whilst occupied, it is recommended the building be regarded as having a limited life from a seismic perspective of five years," it said.
Some minor risk mitigation work was going on, such as putting film on windows.
The wider problem is Whakatāne has been promised a whole new facility, but it cannot be built in the fault zone.
A whole new business case, jointly with Tauranga - which is also in line to get a new mental health unit - is having to be done, both for the seismic reason and because the previous business plan was not good enough, documents show.