Deniliquin Fire + Rescue NSW was called to the facility about 7.20pm.
Bushes in front of the hospital were alight, and Acting Captain Les Booth said it was caused by a discarded cigarette.
Act Capt Booth said improper disposal of cigarettes, including throwing lit cigarette butts from moving vehicles, is a fire risk and bad for the environment.
Heavy penalties can apply, particularly on days of Total Fire Ban.
Fines of between $660 and up to $5500 can apply for anyone caught tossing a lit cigarette from a vehicle - driver or passenger.
On Total Fire Ban days, this fine can be as much as $11,000 can apply.
Littering fines of $1000 may also apply for anyone improperly discarding cigarettes.
West Deni blaze
A small grass fire was extinguished at the corner of Sloane and Macauley Sts, Deniliquin about 6pm Tuesday.
Act Capt Booth said the cause of the blaze is unknown, but said it had started at the base of a power pole.