Elective surgery has been put on hold at Corowa Hospital on the NSW border with Victoria, after four patients and one fully vaccinated staff member became infected with COVID-19.
The source of the outbreak and spread is unknown and under investigation.
No other exposure sites have been identified in the small rural town.
Chief executive of the Murrumbidgee Local Health District (MLHD), Jill Ludford said "close contacts are being supported and are currently undergoing testing."
She said locals they can still present to the hospital and expect to be cared for.
"For people that live in the Corowa region the hospital remains open and I still urge people to present for care," she said.
Ms Ludford said they are also offering virtual appointments for people accessing the hospitals community care services.
"That's all about keeping people safe and minimising movements in that particular area."
Double vaccination rates in the Federation Local Government Area, which take in Corowa, are among the highest in the state at more than 95 per cent.
More broadly across the local health district the first dose rate is 97.3 per cent, while 90.5 per cent are fully vaccinated.
Ms Ludford said those high vaccination rates mean Corowa is well placed to handle the cluster.
"We have to remind ourselves that it's different now because we are a vaccinated population, and that's different to where we were before."
No new cases linked to Tolland funeral, yet
Cases are expected to rise in Wagga Wagga after a positive case attended a funeral in Tolland, along with hundreds of others, last Friday.
Ms Ludford says while no new linked cases have been identified, it's still too early to tell if there was any spread associated with the event.
"I think not enough time has gone by for the infections period.
