A new $70 million day hospital is expected to be built in Busselton.
St John of God Bunbury on Wednesday announced its plan to build the private hospital on a 1.3-hectare site in Vasse town centre.
The hospital would be open 23 hours a day and would include oncology, dialysis and ambulatory services such as physiotherapy, and consulting rooms for specialist doctors.
It will be built in conjunction with Blackoak Capital Ventures and Invested Health Developments.
St John of God Bunbury chief executive Jeffrey Williams said construction would start in 2023, subject to planning and regulatory approvals.
He said there was a "growing need" for care closer to Busselton and the broader Margaret River region.
"We have been part of the south west community for almost 100 years and remain deeply committed to this region," Mr Williams said.
"This new facility will allow our team of specialist doctors, nurses and allied health professionals to continue to provide high quality, compassionate and contemporary care across the South West region which has a continued growth trajectory."
The project would be the biggest healthcare project in the South West region since the $120 million Busselton Hospital was built in 2014-15.
Blackoak Capital Ventures managing partner Tim Mack said the Vasse town centre was chosen because of its location at the junction of the Busselton Bypass and Bussell Highway and because of its vibrant cafes, shops and local businesses.
The land is currently owned by a joint venture of Perron Developments and Stawell.
Perron Developments spokesman Lyle Kenny said the vision was to create a village that gave residents and the broader South West community a range of services and amenities to meet their day to day needs.
"The development of a substantial health care facility will enhance the appeal of Vasse Village as a destination of choice, while further complementing our focus on innovative design, landscaping, and public artworks to create a unique village environment," Mr Kenny said.