Grenfell's long-awaited new Multipurpose Service (MPS) remains firmly on the radar of NSW Health, with senior officials confirming the project is considered a priority during last week's budget estimates hearing in Parliament.

The future of the Grenfell MPS was raised by Nationals MLC Sarah Mitchell during budget estimates, with Deputy Secretary for Rural and Regional Health Luke Sloane describing Grenfell as "one of those priority sites" for Western NSW.

Mr Sloane said the Grenfell proposal sits alongside other priority MPS projects, including Lake Cargelligo, as NSW Health works through funding priorities for rural health facilities.

Importantly for the Grenfell community, officials acknowledged the town's MPS is the only aged-care facility in town and said community advocacy had been a significant factor in keeping the project on the agenda.

"We've had multiple representations from the community," Mr Sloane told the hearing.

Health Infrastructure chief executive Emma Skulander said the Grenfell project has already been put forward by the Western NSW Local Health District as an asset priority through NSW Health's capital planning process.

The project will now be considered against other proposals from across the state as part of the annual funding assessment process.

A major focus of the proposed redevelopment is increasing aged-care capacity.

Officials said efforts are continuing to align state and Commonwealth funding to support additional aged-care beds already earmarked for the facility.

While no funding commitment or construction timeline was announced, the hearing confirmed that clinical service planning for Grenfell has been completed and that the project remains in active consideration by NSW Health.

Local residents and community groups have spent years advocating for a modern, fit-for-purpose hospital and aged-care facility to serve Grenfell and surrounding communities and will continue to do so.

Ms Mitchell asked where a new fit-for-purpose Grenfell MPS ranked among NSW Health's infrastructure priorities, prompting officials to reaffirm the project's status as a priority site for Western NSW.

With NSW Health now reviewing infrastructure priorities ahead of future budget decisions, it is hoped Grenfell's place on the priority list translates into funding certainty in the near future.