Papua New Guinea's government says public hospital managers will be suspended or replaced if they do not deliver basic healthcare to patients.
Health Minister Michael Malabag says the managers of the Wewak and Kimbe hospitals have been suspended over alleged financial mismanagement.
Five other managers are facing suspension over similar allegations.
Mr Malabag told Radio Australia's he wants to give a clear signal to the management of public hospitals throughout the country.
"The government in the 2013 budget allocation has put in much resources back into the health sector," he said.
"It's now a question of prudent management and I need very strong-willed administrators in there to make sure that the funds are expended properly, and that our people see services coming from the government at the end of the day."
"Unfortunately some, especially hospital boards, are not functioning in the manner that is required...it's purely performance based. If they're not performing, I'll take appropriate action."