"After my visit to Penticton last month, I committed to look at how we can move along plans for the new tower," Clark in a statement.
Doctors in Penticton have said the city's hospital is on the verge of major troubles because of overcrowding and outdated facilities.
Two million dollars has been committed for the development of the business case, which will start next month and is expected to be completed in 2014.
"Following approval of the business case, procurement for construction of a new patient care tower would commence," said the statement.
The cost and size of the new tower will be determined by the study.
"It is anticipated that the capital cost of the redevelopment project will be shared between the Province and the Okanagan Similkameen Regional Hospital District and the South Okanagan Similkameen Medical Foundation," said the statement.