The firm was in line to deliver a £336m critical care hospital near Basingstoke in Hampshire, but now the health trust has cancelled the scheme because of its high cost.
Last week Nuffield Health put construction of a £70m private hospital at the former Manchester Metropolitan University campus on hold, just as Kier was due to start work.
This decision was blamed on a drop in NHS referrals which had led to significantly lower than anticipated revenues in the private health market causing Nuffield to think again about expansion plans.
Kier was named preferred bidder for a £160m contract to design and build the critical treatment hospital for Hampshire Hospitals NHS Foundation Trust, at the time acclaimed as the largest hospital project to be let under a ProCure 21+ framework.
The hospital project has hit the buffers been thrown out after five years of planning.
The new 45,000 sq m campus was to be built to the west of Basingstoke and included a new cancer treatment centre and critical pathology laboratories, with work originally planned to start on site in April 2016.
A meeting of North and West Hampshire clinical commissioning groups said the hospital was “not affordable, given the financial challenges facing the local NHS”.