A $4.4 million redevelopment will see the emergency department and acute care ward moved from the second-storey of the building to the main floor.

Works for the project began in early June with the major refurbishment set out in three stages and expected to be completed in mid 2020.

Gloucester hospital's health service manager, Paul Townsend is looking forward to bringing contemporary care to the community.

"This is very exciting for health care in Gloucester with the construction of a brand new purpose-built emergency department," Mr Townsend said.

It's a far cry from the circa 1955 facilities that hospital staff, patients and aged care residents have gotten used to over the years. Switching the emergency department to the ground level means no more need to use the elevator when the ambulance arrives. Not only that, the ambulance will have its own fancy new entrance away from the visitor parking area, complete with an ambulance bay and an airlock.

The front entrance will be transformed with new entryway and waiting room to be constructed with direct access to the front of the building. The project aims to align the hospital with contemporary health care standards by improving patient flow and access to services, and the working environment for staff.

But getting through the final stages may prove to be a little tricky, as the new acute care ward is due to be constructed in the current location of Narraweema aged care unit. Ideally the project would align with the opening of the new nursing home, offering the current residents a new facility to move straight into.

However, despite best efforts this may not occur, meaning residents will be moved into refurbished units on the first floor until the new facilities are ready. This move has been discussed with residents and their families, with hospital staff working hard to ensure there is minimal impact on residents. Thus the decision to complete the project in stages, to keep the hospital continuing to meet the needs of its aged care residents and the community into the future.

As an added bonus for Gloucester, site manager for Kingston Building, Jon Scala said he plans to work with as many local contractors as possible on the project, starting with Gloucester based, Hunter Asbestos and Demolition, which has already started preparing the site.

The redevelopment project is part of the Rural Health Infrastructure Program in the 2018-19 NSW budget announced a year ago.

The construction contract has been awarded to Newcastle company, Kingston Building, the same group awarded the contract for the Anglican Care nursing home project.