A two-year-old who died at a scandal-plagued hospital has been remembered by his parents as the catalyst for major health reform.

The Northern Beaches Hospital in Sydney completed its transition to the public health system on Wednesday, ending eight years of private ownership under Australia's second-biggest private hospital operator, Healthscope.

The death of Joe Massa, who died after waiting three hours for urgent treatment, prompted parents Elouise and Danny to crusade against private ownership of emergency care.

That led to the passing of "Joe's Law", which banned future private-public hospital partnerships and paved the way for the facility to be brought into public hands.

"Why was it our family had to be the catalyst for change? But as life has it, it was," Elouise told reporters on Wednesday.

"I feel so immensely proud Joe has contributed to making this possible for our community."

The Massas launched what Premier Chris Minns said was perhaps the most extraordinary public policy change he'd seen.

"It represents one of the fundamentals of government services, and that is emergency departments and hospitals can't be run for profit," the premier said.

"They need to be run for people."

More than 1800 Northern Beaches Hospital staff have now joined NSW Health, and the state's first high-volume planned surgery centre will soon be established at the facility.

Roughly a third of the beds will remain dedicated to private patients until June 2027, Health Minister Ryan Park said.

But Mr Park insisted bringing the hospital into the public health network would be positive for all patients needing access to specialised care.

"Previously, Northern Beaches (Hospital) almost sat as an island, it didn't engage with the local health district," Mr Park said.

The Australian Medical Association's NSW president Kathryn Austin, welcomed the interim continuation of private services but said staff will need clarity about long-term care plans.

An April 2025 report into the hospital found the public-private partnership created tension between health care and profits, and accused management of failing to take sufficient action to stop clinical safety risks.

Healthscope runs 37 hospitals across the nation and was initially contracted to run the Northern Beaches institution until 2038.

It had gone to the government in 2023 to try to terminate the $2 billion contract, citing insufficient funding, poor health network integration and other reasons.

Although the NSW government will pay $190 million to Healthscope, it has stressed there would be no windfall gains for the provider.

Healthscope went into receivership in May 2025 over financial debts totalling about $1.6 billion.