The chief executive of the Otago and Southland district health boards says the benefits of merging outweigh the disadvantages and a new, combined board needs to take over in July.
In recommendations released on Tuesday, Brian Rousseau says streamlining into one district, called the Southern DHB, would save much more than the $500,000 per year previously estimated.
Otago DHB will meet on Thursday and Southland a week later to decide whether to merge.
Mr Rousseau says there should be three seats for Southland and four for Otago on the new board, so both regions retain their voice.
The two boards have a combined deficit of more than $15 million.
However, Mr Rousseau says further savings will be limited unless they merge. He says the benefits outweigh the disadvantages.
He also says that a priority for the new board must be getting the support of clinical staff for the merger.