The state's leading medical body has warned that NSW hospitals will reach crisis point in 2017 if the Abbott government keeps its health spending cuts.

NSW hospitals will be at crisis point in two years if the federal government continues to "gouge" funding from the health sector, says the state's Australian Medical Association.

"We have a federal government whose commitment is to defund health, to gouge health, to take money out of the health budget," said AMA NSW president Dr Saxon Smith on Tuesday.

The call for the Abbott government to reverse its $1.8 billion cuts to healthcare comes ahead of next week's state budget, which is expected to be generous for hospitals.

Health spending has consistently accounted for around 27 per cent of the NSW budget over the past decade.

Dr Smith said the Baird government had promised $5 billion in hospital upgrades and 3500 more staff during its re-election campaign.

However the reliance on state coffers for the sector's future was unsustainable, he said.

"If the federal government continues to walk away from funding health...we can only see the system slowly degrading as the state government can only do so much," he said.

"You start to lose in the first year (after 2017) $380 million, in the second year $500 million...this is a large amount of money that a state government just can't simply find under a pillow."