A $1.6 billion funding boost has been promised for NSW hospital upgrades in the budget but some hospitals will miss out.

A record $22 billion has been set aside for health in the NSW budget, but there's nothing yet for some Sydney hospitals desperately in need of building upgrades.

The five per cent increase in recurrent spending includes $375 million for emergency department visits and additional elective surgeries.

Some $1.6 billion is being promised for public hospital upgrades, including $133 million for Gosford Hospital on the north coast and $99 million toward a revamp of Westmead Hospital in Sydney's west.

But there was no direct funding for hospitals identified as desperately needing upgrades, such as the Nepean and Concord hospitals - also in Sydney's west.

Treasurer Gladys Berejiklian defended the allocations, saying the coalition government was working hard to get through a list of hospital projects.

"We would love to bring forward construction of every single hospital project we have on the go ... but we have to make sure that what we're spending is manageable," she said as the 2016/17 budget was handed down on Tuesday.

A looming fiscal gap in federal health funding, which is expected to drop after 2020, was also not addressed in the budget papers.

While Ms Berejiklian concedes there are challenges ahead, "this budget shows that we are managing those stresses very well".

The budget includes $1.8 billion for mental health services, and the creation of 900 extra nurse, doctor, allied health and hospital support staff positions.

Another $12.8 million will be spent for an extra 85 paramedics, while $5 million has been promised to improve hospital security, including training emergency staff to deal with disturbed or aggressive patients.

HEALTH SPENDING IN NSW BUDGET

* $1.6b: hospital upgrades and redevelopments
* $1.8b: mental health services
* $375m: emergency department visits and additional elective surgeries
* $5m : improving hospital security