The eight-bed facility is the first stage in a major overhaul planned for the private hospital complex, while 14 new surgical beds will also be made available in revamped wards as part of the final design plans.

When completed, the ICU will offer patients a similar standard of care to that offered at the city's only current intensive care unit, at Bendigo Hospital.

St John of God Hospital Bendigo chief executive officer Michael Hogan said he expected the building contract for construction works to be finalised in five weeks.

"It's a fantastic extra service for the Bendigo community, particularly for privately insured patients," Mr Hogan said.

"It's a precursor to a more major development, where we extend the entire hospital.

"This is the starting point where we improve the services, renovate the older areas and then sometime in the next few years we'll be doing a more major extension."

Mr Hogan estimated that six private patients were treated at Bendigo Hospital each week - or more than 300 patients each year - for conditions that cannot currently be treated at St John of God.

A Bendigo Health spokeswoman said the public hospital's 12-bed Critical Care Unit, which comprised its intensive and coronary care facilities, used an average of six to seven beds at any one time for intensive care.

The spokeswoman said the development would allow Bendigo Health to treat more patients with acute needs locally, instead of transferring them to Melbourne hospitals.

"Both (ICUs) will have very similar types of treatment and levels of service," Mr Hogan said, adding that resident doctors able to provide care 24 hours a day, seven days a week would staff the unit.

"People that have really acute conditions that require intensive care will be able to receive those services from us.

"They're particularly people that are having major surgery, but also people with unstable cardiac conditions.

"In terms of renovating surgical beds, we have some older parts of the hospital that we've been wanting to improve for some time, so some of those older accommodation areas will be completely gutted and we'll be re-doing them completely so they're modern and spacious."

Bendigo Health chief medical officer Dr Peter Sloan has welcomed the additional ICU facilities.