The Otago and Southland district health boards have agreed to share one chief executive.
Growing difficulties in recruiting and retaining the staff they need have helped drive increasingly urgent moves by New Zealand's 21 DHBs to collaborate.
Otago and Southland DHBs have led the way in a move that has got strong Government backing and which the National Party has broadly supported.
The two southern-most DHBs have merged key jobs, mounted a joint clinical service, and had appointed Otago DHB head Brian Rousseau in charge of Southland on an interim basis.
The DHBs announced on Friday that Mr Rousseau's appointment will be permanent.
The boards governing both DHBs say the collaboration will help them better provide services across a large, sparsely populated region.
