Opposition leader Ted Baillieu announced the funding during a visit to Ballarat this morning.

Mr Baillieu said BDNH provided a vital service to thousands of patients throughout the Grampians region.

''This funding of $1.8 million committed by the Coalition will ensure that the agency will be able to undertake the much-needed redevelopment of their base in Ballarat, which in turn enable them to adequately provide services for the projected increase of patients in the

region,'' he said.

BDNH chairwoman Professor Sally Wellard said the building, located in Sturt St, was over-crowded and needed urgent redevelopment.

''We don't have adequate office space for the number of nurses,'' Professor Wellard said.

''They're on the road a lot of the time but when they come back there isn't the internet infrastructure in the building to be able to provide nurses with online support for their work.''

Professor Wellard said the redevelopment would create more space for clients to attend podiatry services at the centre.

BDNH provides a vareity of services including diabetes care, aged care services, post acute care services, palliative care and chronic disease self management.

The health care provider will celebrate its centenary in April next year.