Construction is now underway on the $254 million expansion of Kelowna General Hospital.

Premier Gordon Campbell and Health Minister George Abbott were joined by a host of MLAs and dignitaries for the groundbreaking Monday.

When complete in August of 2012, the six storey expansion will include a larger emergency room, increased surgical capacity, a new renal dialysis department, a rooftop helipad and two shelled in floors for patient care beds.

A two-storey, stand alone medical school is also being constructed which is scheduled for completion by the end of 2009.

The KGH expansion is being done in conjunction with a $178 million expansion at Vernon Jubilee Hospital.

"$432 million is the largest ever investment in health care infrastructure in the Okanagan in the history of the province," says Campbell.

"The population of the Central Okanagan has grown by 25 per cent in the last 12 years. More than 35,000 new residents live here. It's projected to grow to an equivalent amount in the next 12 years."

Dr. Sandy Nash, head of ambulatory care at KGH, says the new facility will improve ambulatory care in the valley, which he says is the future of medicine.

"As patients, we don't want to be hospitalized, we want preventative medicine, a quick diagnosis, we want the procedure done and we want to go home," says Nash.

"That's what the ambulatory care aspect of this building will do. It's really the future of medicine and will allow the public health system to survive."

Nash adds the real legacy of the project is the medical school, which will be run in partnership with Interior Health and UBC-Okanagan.

"The medical program will have a tremendous impact on KGH, a tremendous impact on the university and a tremendous impact on the region. It will allow us to attract the best-of-the-best in education and medicine."