The state says $500,000 has been released to improve the Lana'i Community Health Center.
The money was set aside by state lawmakers last session to go toward the construction of the new facility.
The center serves nearly 1,200 patients, which is approximately 40 percent of the island's estimated population.
State officials say the new facility will be located in the heart of Lanai City and will be nearly five times larger than the existing one.
"My colleagues and I worked hard to secure the $500,000 in the state budget to help fund the LCHC project. The people of Lana'i deserve a new center in a prime location to provide better access for those who need these types of necessary healthcare and dental services," said Sen. J. Kalani English. "With its larger design in a central location, more people in this remote area will receive care from top-notch professionals."