Healthcare in Lambeth is to be restructured in a bid to absorb massive predicted funding cuts, it has been confirmed.

Services are to be shifted away from hospitals and into communities to try and cut a potential funding reduction of more than £130m by 2013-14.

The “Polysystem” strategy to absorb the funding cuts - equivalent to more than 20 per cent of NHS Lambeth’s total budget - was confirmed by the authority in its five year strategy report.

Lambeth will be divided into three distinct areas, each with a network of health and social care services serving between 80,000 and 140,000 residents.

The heart of the polysystem in the south west of the borough will be “polyclinic” Gracefield Gardens in Streatham.

It will combine GP services, community services, routine hospital care and council services under one roof. A diagnostics centre including audiology, ultrasound and x-ray is also planned for the building.

Other GP surgeries, health centres and local pharmacies will offer health tests, minor surgery and outpatient clinics as part of the polysystem strategy.

The polysystems are intended to create more joined-up healthcare services, stopping duplication and avoiding unnecessary hospital use.

It is also hoped it will be more popular with residents by providing services closer to home.

NHS Lambeth predicts the new polysystem would help towards £45m in savings in A&E costs, and £85m outpatient saving costs by the end of 2013-14.

But many fear the healthcare system would not be able to cope with such a massive loss of funding.

In the report, NHS Lambeth points to recent improvements in healthcare being due to an increase in funding from £400m a year in 2003-04 to more than £600m in 2009-10.

But at a council debate on the future of health in the borough in January, Lambeth Council’s head of adult and community services, Jo Cleary, said the funding loss could create a situation “too difficult to contemplate for the borough’s vulnerable people”.