The Southern District Health Board is likely to pull out of the day to day running of Queenstown Hospital - in favour of a local trust to run the facility.
However, DHB chief executive Carole Heatley, who fronted a large meeting in the resort last night, said that was still a decision for the local community to make and the DHB would not impose something the community did not want.
The Southern DHB needed to cut its deficit and had been consulting with local communities for weeks about its strategy to try and slash costs.
But it was always going to be the meeting in Queenstown which drew the biggest crowds.
Local resident Debbie Rewi said she had major concerns about the way health care was delivered.
She was concerned there was no consolation with Maori and the DHB was cutting funds for Maori services because the DHB said they were not needed.
"Well of course the most under-represented group in the meeting tonight has been the Maori sector, which is a growing population here in Queenstown, with at least 10 percent of our population," Mrs Rewi said.
The debate centred on who was going to run the hospital, the DHB or a local trust.
Local GP Hanz Raetz, who tried to promote a trust run hospital several years ago, said the discussion was like de-ja-vu.
"This is like the third or fourth time I've been in these meetings with the same pronouncements every time.
"We've had the whole talk about a community trust before.
"So I'm not sure what we're actually trying to achieve here," Dr Raetz said.
One thing the DHB had been clear about was that there was no money to rebuild the ageing Lakes District Hospital building.
Former DHB board member Fiona McArthur said a locally run trust may be the only option if residents wanted better facilities.
"If you go and use Lakes (District Hospital) for palliative care there are no en-suited rooms, yet an hour and a quarter down the road at Dunstan (Hospital in Clyde) there are and it's how we address those very important issues," Ms McArthur said.
Many at the meeting, like local developer Alastair Porter, were confused about exactly what the DHB was proposing for Queenstown and were worried that tourists accessing the emergency department were eating up money allocated for public health services.
"What people want to know in Queenstown is what is going to be done to sort out the Queenstown problems.
"And one of the biggest problems we have here is that we have two million tourists a year and yet there is no allocation of (public) funding for those people," Mr Porter said.
Ms Heatley said the meeting was invaluable - because the feedback was so good.
But she said Queenstown was in charge of its own destiny.
"I think this town's really going to get behind exploring the possibilities of having a community run trust to run its hospital and I think they'll make the right decision for them and I think its absolutely right that they do make that decision," Mrs Heatley said.
The feedback would now be collated and a report prepared by February next year.
From there decisions about who runs the hospital and how much money would be spent funding it would be made.