Tuatapere Maternity remains open for births, but an offer of a six-month funding reprieve from the Southern District Health Board has been declined as insufficient, Waiau Health Trust chairman Justin Lewis says.
The DHB stopped funding the centre for births at the end of March, saying it was not clinically or financially sustainable.
However, it offered the trust a six-month extension to allow the centre to trial a new model of care, in the wake of community opposition.
Mr Lewis said the centre was using trust funds to operate while continuing to negotiate with the DHB for a higher offer.
Despite offering a "sweetener" in the form of a big increase in the one-off allowance for running a rural maternity facility, the DHB had slashed payments for births and post-natal services.
The new rates were comparable to those received about the year 2000, he said.
It set a dangerous precedent for rural maternity providers, which might find themselves having to accept less favourable pricing next time their contracts came up, Mr Lewis said.
Through a spokesman, SDHB finance and funding general manager Robert Mackway-Jones said the reduction in birthing and post-natal payouts must be cons-idered together with the increase offered for running the facility.
It was "misleading" to assume the funding arrangement for Tuatapere could be applied to other places. The DHB was still working with the trust to find a solution, he said.
