Total spending on health will rise to $14.7 billion a year, including $1.6 billion over four years to improve frontline health services.
Some $1 billion of that amount is for district health boards to cover population growth and inflation over the next four years.
The Government says the total includes $352 million in new funding each year.
The new initiatives include $92 million over four years to pay family members who look after their adult disabled children; $35.5 million to boost diabetes services and $70 million already announced for aged care and dementia.
As well, there is $100 million over four years to meet population changes and cost pressures in disability services; $48 million for more non-urgent or elective operations; $25 million for more breast and other screening; $18.2 million for a new mothers-and-babies initiative that is still to be announced; $7.3 million for more medical student training places; and $7 million to do more pre-school health checks.
Some $191 million from savings and reprioritisation has gone back into health.
Savings in health include $48 million over four years from more efficient disability support contracting; $30 million from rationalising and consolidating public health service contracts, a $14 million under-spend from those contracts; and $12 million from lower-than-expected Voluntary Bonding Scheme costs.
Health Minister Tony Ryall says health has received a third of all new operating funding in the Budget.
Mr Ryall says the boost is due to careful financial management over the past four years, including a reduction by DHBs, except Canterbury, of their deficits from $150 million to $25 million.
Mr Tony Ryall says the good financial management has provided the money to target key health needs in the population.
He says the $1.6 billion over the next four years is for new initiatives and cost pressures.
Mr Ryall says that's better than most other countries around the world have been able to achieve.
"This Budget continues to show that we are determined to protect and grow the health service but because of good financial management we've been able to invest in areas that reflect the changing needs of our population.
"We've been investing heavily in dementia, which is going to be a major challenge; money into ... heart disease; and more elective surgery."