Plans to build a new £353 million acute care hospital in the Black Country using funding from the public and private sectors have been approved by the Government.
Chancellor of the Exchequer George Osborne announced approval for the Midland Metropolitan Hospital, in Smethwick, during a visit to meet NHS leaders in nearby Rowley Regis.
Due to open in 2019, the new hospital will replace some existing services at other sites operated by the Sandwell and West Birmingham Hospitals NHS Trust, including the A&E departments at City and Sandwell hospitals.
The trust's chairman Richard Samuda welcomed the granting of permission to begin a tender process for the building of the hospital.
Describing the Government's announcement as a "decisive moment" for the project, Mr Samuda said: "We are delighted to have received approval from the secretary of state to proceed with the new hospital in Smethwick. This reflects support for the business case from both the Department of Health and HM Treasury.
"It is a huge vote of confidence in the trust's long-standing plan to transfer acute care onto a single site."
Mr Osborne said: "This ambitious package will ensure that patients across the West Midlands continue to benefit from access to world-class acute treatment and cutting-edge facilities.
"It is because of the difficult decisions we have taken as a government that we have been able to protect healthcare spending, and announce new facilities like the Midland Metropolitan Hospital."
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