Alfred Health, Peninsula Health and Kooweerup Regional Health reveal shock merger

Two of Melbourne’s major health services will merge, just months after a controversial plan called for forced hospital amalgamations.

The Alfred Hospital is included in the merger. Picture: David Crosling

Two of Melbourne’s major health services will merge, with The Alfred and Peninsula Health revealing the surprise news on Thursday.

The pair said they would form Bayside Health — which would also include Kooweerup Regional Health Service — in less than 13 months.

In a statement, the services said the “voluntary merger” was approved by their boards this month and would come into effect on January 1 2026.

Heated debate has erupted over hospital mergers in recent months, after a government review found the “siloed nature” of Victoria’s health system led to fragmented, inconsistent care and duplication.

The review called for forced amalgamations of the state’s 76 health services, which the Allan Government rejected after regional backlash.

But the government accepted other recommendations — such as grouping services into networks that would share administrative roles, resources and surgery waitlists — leading to accusations of amalgamation by stealth.

Jacinta Allan ruled out forced hospital mergers after the health services plan was released. Picture: Diego Fedele

One of the 11 groups recommended by the report was a Bayside network, made up of three services: Alfred Health, Peninsula Health and Kooweerup Regional Health.

In their statement on Thursday, the trio said their voluntary merger would benefit 1.1 million Victorians, and deliver “better, safer” and “more accessible” health care.

Peninsula Health chief executive Helen Cooper said the new service would provide “easier” and “more seamless” access to care.

Alfred Health chief executive Adam Horsburgh said they already partnered with Peninsula across many areas, and this was a “natural progression”.

“It will build on the strong history of collaboration between our hospitals and will open greater opportunities to develop care.”

Kooweerup Regional Health chief executive Aileen Thoms said their patients will get access to specialist care “close to home”, and they will update the community as they work through the process.

The release did not have details on who would lead Bayside Health or its potential impact on jobs or service locations.

It said Peninsula and Kooweerup would work together “over the coming months” to merge as “a first step”, and the service’s final name — Bayside Health — may change.