A health clinic for the homeless in Sydney is set to close due to a funding shortfall after more than 40 years in operation.

Key points: Haymarket Clinic has lost annual federal funding of $900k

Haymarket Clinic has lost annual federal funding of $900k Clinic assists homeless people with medical services, showers and mail collection

Clinic assists homeless people with medical services, showers and mail collection Clients say clinic's closure will be "devastating"

The Haymarket Clinic in Darlinghurst is staffed by doctors, nurses, welfare workers and a psychologist, and provides services such as vaccinations, the prescribing of antibiotics, health education and referrals to drug and alcohol services.

About 20 homeless and other disadvantaged people seek medical treatment at the clinic daily, with a further 60 accessing other services such as showers and mail collection.

The clinic, which is part of the Haymarket Foundation, lost its annual federal funding of $900,000 as part of cuts announced in the 2014-15 Mid-Year Economic and Fiscal Outlook (MYEFO) and despite a one-off transitional payment of $990,000 from the Commonwealth, has been unable to secure an alternative funding source.

The clinic was started in 1974, offering services out of a caravan in Haymarket, and grew into a small medical centre run from a terraced house in Palmer Street, Darlinghurst.

Dr Gavin Frost was a founding member of the Haymarket Clinic, and said it provided "a pair of clean socks, something to eat, a shower, see the doctor, see the nurse, have your wound dressed, see the psychologist, get referred for surgery if that's appropriate".

"A lot of the clientele have mental health problems, drug and alcohol problems, HIV-related problems as well, and the service is available to them all the time."

In a statement, the federal Health Department said there were many similar services supported via a range of other mechanisms, such as state and local government funding, public hospitals, health services and charitable organisations.

The Haymarket Foundation has been running a number of other programs targeting homelessness and disadvantage in the inner city, with the NSW Government providing more than $2 million in funding and the Commonwealth more than $300,000 in support.

Raymond says he can tell doctors at the clinic how he is coping with being homeless. ( ABC News: Siobhan Fogarty )

Haymarket Foundation chief executive officer Mat Flynn said no-one in government wanted to take responsibility for funding the clinic.

"We're working with around 1,200 clients every single year with our doctors, nurses and welfare staff, and we're worried about them," he said.

Haymarket Clinic closure upsets patients

The clinic's closure is an unsettling prospect for its patients.

Raymond, aged 70, has been homeless on-and-off for the past 10 years and is currently sleeping rough.

He said he had been visiting the Haymarket Clinic for more than 20 years.

"I can come here in the mornings when I get up from my swag where I'm sleeping, and I can come here and I can have a shower and a shave and clean my teeth and see the nurse," he said.

"They are interested enough here to ask, they know me and they know homelessness and the way we live."

Homelessness New South Wales chief executive officer Katherine McKernan said the clinic offered continuity of care for its patients, and its closure would mean an added burden for homeless people.

"It will mean they'll have to visit, often, emergency departments and other health services and have to tell their story over and over again," she said.

Henry, known as Hank, aged 67, has been coming to the Haymarket Clinic for the past 10 years.

"I was on the streets for about five months before I found the Haymarket Clinic," he said.

"It helped me off the streets, it helped me with deep depression and they've looked after me ever since.

"I wouldn't know where to go, I would be devastated, I don't know what I would do."

The clinic is expected to close its doors shortly after its funding runs out at the end of April.