Health Minister Ian Taylor has slammed the AMA for blatant politicking three days before the State election.
"If the AMA wishes to make public comments about the funding of health services it should at least take the trouble to be properly informed and not allow its political ambitions to distort the truth," Mr Taylor said.
"There is no question of hospitals running out of funds and starting to ration services," Mr Taylor said.
"The suggestion that particular hospitals are in debt is ludicrous and shows a lamentable lack of understanding of the budgetary process.
"There has been some increase in hospital expenditure arising from a number of factors, including the increased costs of visiting medical officers who have recently received a substantial fee increase.
"These influences have caused some variation to budget projections and will be addressed as part of the normal management process.
"In addition, the AMA should be well aware that the closure of some wards and beds at Christmas-time is a long established practice which reflects the downturn in demand and provides an opportunity for staff to take leave and for maintenance to be undertaken.
"What the AMA should be doing, if it is really operating in the public interest, is questioning what health services are going to be reduced or even axed as the result of a $116 million hole in the Opposition's health funding."