Victoria's peak business group is urging the federal government not to continue COVID support payments a day longer than necessary.

The state is currently battling a COVID outbreak putting enormous strain on the health system, with the number of Victorians in hospital with the virus nearly doubling in the past month.

A snap national cabinet meeting on Saturday agreed to extend a scheme offering $750 to Australians who tested positive but did not have access to sick leave.

There had been mounting pressure on government after the scheme expired on June 30, with concerns vulnerable Australians would not be able to afford to isolate despite having the virus.

Prime Minister Anthony Albanese said the decision was made in recognition of the risks associated with new, more infectious, COVID-19 variants.

"I want to make sure that people aren't left behind, that vulnerable people are looked after and that no-one is faced with the unenviable choice of not being able to isolate properly without losing an income and without being put in a situation that is very difficult," he said.

The payment has been extended until September 30 and is also available for people who need to stay home and care for a person with COVID-19, including children under 16 or a person with a disability, as well as close contacts.

Business leaders acknowledge pandemic is not over

Head of the Victorian Chamber of Commerce and Industry, Paul Guerra, welcomed the announcement but said the government must ensure it keeps the balance between supporting people in need and running the economy into debt.

"The federal government has told us the pandemic is not over," Mr Guerra said.

"The current wave seems to be stronger than we might have all first thought so we think it's a good thing that support is being provided there for those who are in need.

Mr Guerra said the cost of the pandemic support payments would be justified if it prevented a more widespread outbreak that could cripple the country.

"Those who have got access to sick leave and the like, they should be isolating anyway but those who don't, here's the incentive that they now have to make sure they don't work when they might actually have COVID," he said.

Nurses, health workers exhausted

The Australian Nursing and Midwifery Federation has commended the state, territory and federal leaders for re-thinking their earlier decision not to extend the scheme.

Federal Secretary Annie Butler said it will allow people to abide by critical public health measures to try to contain the virus during winter.

"Nurses and midwives and care workers across the country, they're now two-and-a-half years into this pandemic, as we all are, but they've been on the frontline the whole time," she said.

The Royal Australian College of GPs said the entire health care system is under stress, with president Karen Price urging the community to treat their doctors and front desk staff with kindness.

"I think people are just a bit tired and a bit burnt out, and that includes everybody," she said.

She said staff illnesses are also affecting GP clinics.

"There are a lot of staff absences due to illness and people are finding it difficult having to work extra hard to provide the same level of service so I think we're all a bit frustrated and we're still in the middle of a pretty serious pandemic," she said.

Health authorities said more than 10,000 hospital staff were absent from work in the first week of July alone.

The pressure on the system is being exacerbated by a massive jump of Victorians in hospital with COVID, which has increased by 99 per cent since June 22.

Government announces support for Victorian hospitals

Premier Daniel Andrews announced on Sunday a $162 million package to recruit around 400 additional staff for 12 major hospitals across the state to combat staff shortages.

This will include dedicated nurses to help ambulances offload patients, triage doctors and discharge coordinators.

He also said two private hospitals would be supported to set up emergency departments, but did not say which ones.

Two paediatric GP respiratory clinics will be established at the Royal Children's and Monash Children's hospitals to prevent children from having to go to the emergency department if they are struggling with COVID, the flu, asthma or hayfever.

Mr Andrews said multiple factors were putting pressure on hospitals, leading to delays.

"Winter is never easy in the health system and this winter is particularly challenging due to both borders being open and a very nasty flu — lots of flu cases — and a particularly challenging strain of the flu and of course these Omicron sub-variants," he said.

Mr Andrews said there will come a point where there will be "ultimately no isolation period" for positive COVID-19 cases, but changing the rule now would put unbearable pressure on the system.

Health Minister Mary-Anne Thomas called on Victorians to get vaccinated against COVID and wear masks indoors, despite them not being mandated except in limited settings such as public transport.

"Make sure that you continue to wear masks where you are required to, and indeed, in indoor settings or in crowded spaces," she said.

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