St John of God Pathology has advised hospital management, medical staff and pathology staff in Victoria's regional towns of Ararat, Stawell, Kerang and Kyabram of a proposal to provide a more sustainable pathology service without laboratories on site.

East Grampians Health Service chief executive officer, Nick Bush is hopeful that any potential Pathology service cuts announced by St John of God will have minimal impact on staff at the Ararat hospital.

Mr Bush is expecting that jobs would be lost as a result of the announcement and while at the end of the day EGHS doesn't have a say, he is hopeful through negotiation that no staff cuts will be made in this region.

"It comes back to St John of God, they're the contract provider of pathology services and we have an agreement with them to provide the service to us," he said.

"We are the receiver, so yes the ultimate decision of staffing and the service model is theirs.

"I think we are still in discussions, I don't believe any decision has been made.

"What we are aiming for is that there will be no impact on the East Grampians Health, because we need to ensure that our services remain safe and that our doctors are well supported.

"We do more than 100 births a year, so we need to have high level pathology services to be able to deliver them in a safe environment."

Mr Bush said St John of God had spoken with staff at the East Grampians Health Service and doctors at the Ararat Medical Centre about the potential changes.

The EGHS board has also been briefed on the situation.

Mr Bush said Ararat's health service has had a long term working relationship with St John of God, however its contract ends at the end of this year and a tender process will take place to decide on what pathology service provider best serves this region.

"That will be the big decider of what comes back when St John of God put up their tender," he said.

"We are discussing with St John of God that if they make these changes, it needs to be within the interests of our community that we don't get a reduction in services.

"St John of God have been very good supporters of the health service. The have had an agreement here for many years to deliver blood tests and the staff are locals who are very committed to service.

"We are negotiating with St John of God because the relationship is good."

St John of God Pathology chief executive officer, Michael Hogan said the current funding for pathology services in public hospitals was inadequate to support the significant laboratory infrastructure that St John of God Pathology has in place in a number of small sites, given the relatively low volume and complexity of pathology testing required.

The proposed changes would see urgent tests still conducted on site, but using instrumentation located in the hospital wards. The use of this instrumentation within hospitals has proven to be effective in providing immediate pathology results to clinicians.

All other testing would be conducted at regional laboratories in Bendigo, Ballarat and Horsham under the proposal.

Mr Hogan said the proposed alternative model of service delivery would be more efficient and sustainable, given the current funding available to pathology services and would enable a pathology service to continue to be delivered to regional Victoria.

"We are confident that we will be able to continue to provide a safe and effective service for local doctors and patients," Mr Hogan said.

"We assure the community that all patients at the hospitals in these areas will continue to receive high quality and timely pathology results.

"We also assure local doctors who refer outpatient work to us that they will continue to receive high quality, timely pathology services."

Mr Hogan said 14 laboratory staff across the four sites would be impacted by the proposed laboratory closures.These positions relate to scientific roles.

Staff employed in specimen collection and courier services will not be impacted.

"We are endeavouring to provide redeployment opportunities for these employees and we will support them through this process. We respect that this is a very difficult time for our staff," he said.

As one of the largest health care providers in Australia, St John of God Health Care has provided a service to regional Victoria for over 100 years.

"We remain commmitted to be an ongoing provider of pathology services in regional commuinities," Mr Hogan said.

Discussions with hospital administration and doctors are still being conducted.