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The board unanimously passed a set of resolutions to enable the development of a public-private partnership on Crown land.
Health Minister Tony Ryall will be asked to approve the development.
Board chairman Joe Butterfield was keen to dispel doubts raised by member Dr John Chambers about using public-private partnerships for health services.
Overseas, they had become in some cases a ''contract lawyers' festival'' because of the huge complexity involved.
Mr Butterfield said the Queenstown proposal was much more straightforward and similar developments had been approved in other parts of the country.
Chief executive Carole Heatly said the health board owned the land, which private providers would build on, with a long lease, she said.
Deputy chairman Tim Ward said the arrangement was more that of landlord and tenant than public-private partnership.
Board member Neville Cook said the old Southland health board had wanted to do something similar a decade ago, so he was pleased to see it finally taking shape.
It allowed the development of an integrated health complex the board could never afford on its own.
Board member Richard Thomson hoped the health campus was planned so services fitted together and were not simply located together because of assumed benefits.
Ms Heatly said the plan was to provide multiple services for patients in one place, similar to how a department store worked.
Dr Chambers said he still had questions about the ''public-private partnership that's not a public-private partnership'', and wanted details about financing, planning and building.
These would be detailed in upcoming reports, Ms Heatly said.
Providers include Southern Cross, which might develop a surgical facility, and Bupa, which is already located on-site and might extend its aged care facilities.