The hospital housing the city’s first palliative-care unit has a better chance of survival now that the province has given the board of directors more time to come up with a purchase plan.

“The McGuinty Government believes that keeping services at Toronto Grace is what's best for patients and their community,” Health Minister Deb Matthews said in a statement released Friday.

“I've asked that the Salvation Army grant another extension to the Grace Hospital Board of Directors to give the board full opportunity to develop a plan to continue offering services at that location."

The Salvation Army is the Grace's current owner and is moving away from operating hospitals so it can focus on its other programs. But the board and those who rely on the 119-bed facility are worried another buyer will take over the prime downtown location and spread patients among existing health centres.

The board says over the years it has saved enough of its provincial funding to buy the hospital, but needs time to come up with a proposal.

So Matthews has also asked the Toronto Central Local Health Integration Network – the body that oversees health services for the province – to suspend its request for proposals until further notice.

“I will make sure that Toronto Grace has a strong and bright future. I want to see the plan to keep the services at the present location,” she said.

Grace opened in 1889 as a home for poor mothers-to-be. It went through several incarnations and in 1979 was designated a hospital for chronic and end-of-life care.

Future Of Toronto Grace Hospital Up In The Air: Report