THE Queensland government has demanded the Commonwealth stop withholding millions in funding for its hospitals.

Queensland Health Minister Lawrence Springborg says the state will lose $103 million in federal funding this financial year.

He said the federal government had also withheld funding to Victoria but changed its mind and was now giving it straight to that state's local hospital networks.

Mr Springborg said it should do the same for Queensland.

"Queensland should get that money back because it equals thousands of operations in Queensland," he told ABC radio.

"It means that we won't have to cancel elective surgery for non-urgent patients and also it will mean that we'll be able to save some of the clinical jobs that are now at risk."

Prime Minister Julia Gillard reportedly wrote to Premier Campbell Newman on Wednesday night and flagged her intention to give the money directly to hospitals.

One of Queensland's largest hospitals has cancelled 10 per cent of its surgery because of federal funding cuts.

The Princess Alexandra Hospital in Brisbane has reduced non-urgent surgery such as hip and knee replacements and some spinal operations, Metro South Health chief executive Richard Ashby told The Courier-Mail.

The decision was made after an $18.8 million reduction in federal funding to the hospital.

"Patients may wish to speak with their general practitioners about other referral and treatment options," he said.