The 137-bed Deniyaya Base Hospital provides specialist services in medicine, surgery, obstetrics and gynecology, pediatrics, ophthalmology, dermatology, psychiatry, radiology, laboratory and forensic medicine, as well as emergency care, health education, and primary health services.

Due to the high altitude, steep slopes, and heavy rainfall in the area, the hospital has been affected by landslides in 2023 and 2024, particularly near the Emergency Department, Outpatient Department, and Maternity Unit.

To ensure patient safety and improve service capacity, the Southern Provincial Health Department has acquired land from the Handsford Estate, about 3 km from Deniyaya town, for the new facility. The project, proposed by the Minister of Health and Mass Media, will be implemented in two phases at an estimated cost of Rs. 6,000 million.