Clutha Health First is not accepting new admissions to its 14-bed inpatient ward, and those needing care will be diverted to Dunedin Hospital.
This comes amid a region-wide struggle to staff rural hospitals.
Chief executive Sharon Mason said the closure, effective from yesterday afternoon, was expected to last at least a week unless more doctors could be found.
Staff illness had triggered the temporary closure, but behind this was a larger problem: a national shortage of healthcare workers.
Other hospitals in the region faced similar struggles, she said.
In Balclutha, they were down two and a half roles, which were being recruited for.
In the meantime, they were relying on locum staff.
Temporary closures, which had occurred several times before, were increasing in frequency, she said.
"It’s going to become potentially the norm.
"There are medical officer vacancies, and those vacancies are really challenging to fill — all it takes is for somebody to go off sick and we’re left with gaps."
In addition to alerting people of the situation, she wanted to assure the community Clutha Health First had the wellbeing of patients in mind and was doing its best.
"If we can remediate the situation, we will."
The New Zealand Resident Doctors’ Association told the Otago Daily Times last week there was a "critical shortfall" of resident doctors, and senior medical officers were so stretched out their heavy workloads were causing burnout.
The Association of Medical Specialists said the health sector was under heavy pressure.
Elsewhere in Otago, Dunstan Hospital is struggling to hire and retain nursing staff.
New Zealand Nurses Organisation president Anne Daniels said as a rural hospital, recruitment was difficult.
This was compounded by the pay discrepancy between Te Whatu Ora Health New Zealand nurses and those working elsewhere.
The organisation was advocating for pay parity across all sectors of healthcare.
"Nurses are struggling with the cost of living ... they’re voting with their feet," she said.
In a letter to the Otago Daily Times, a recent patient at Dunstan Hospital said nursing staff were leaving in droves, some for better paid work with Te Whatu Ora.
Fewer beds were available because of this, and many patients were being sent to Dunedin, the patient said.
The situation seemed to be causing low morale among the remaining nurses, who were nevertheless hardworking, kind and knowledgeable.
"The hospital wouldn’t be able to run without them and Wānaka, Cromwell and Alexandra rely on this great little hospital."
