Premier Steven Marshall has warned South Australians the upcoming state budget will be "tough" as it faces a $250 million blackhole in the health department.
Administrators KordaMentha have been called in to analyse the Central Adelaide Local Health Network, which includes the Royal Adelaide Hospital, to develop a three-year financial recovery plan.
Mr Marshall said corrective action was needed, describing the health budget overspend as "massive".
"I think we all appreciate that we were left a complete and utter basket case by the previous government," he said.
But the Opposition's Tom Koutsantonis said the department was best placed to find savings and the move to bring in administrators was "appalling".
"Our public hospitals are there to provide public health," he said.
"You don't treat a hospital like a failing business."
Mr Koutsantonis said it was a signal cuts were coming in the Government's September 4 budget, and likened it to Tony Abbott and Joe Hockey's first budget in 2014.
"Just like Abbott and Hockey when they promised no cuts to health, no cuts to education, their first budget was a horror budget," he said.
"I hope the Premier is not going to repeat the same playbook and Liberal Party handbook that prime minister Abbott and treasurer Hockey did."
The Premier said he had never hidden the fact it would be a tough budget.
"We've got to fix up some of the mess that we inherited from the previous government but we're going to do that," he said.
"Yes, it is going to be a tough budget.
"There are going to be some elements that not everyone is going to find satisfactory, but we'll be making our decisions in the budget in the best interests of all South Australians."
Mr Koutsantonis said if Treasurer Rob Lucas' budget contained serious cuts, it would be a breach of trust with taxpayers.
"The budget is coming at South Australia like a freight train. What is this man planning?" he said.
"They're putting out all the signals of a government that's planning a massive cut which is a breach of what they promised South Australia at the election."
