The HSE says a projected €5.5m budget overrun means staffing restrictions are being imposed at all community nursing units and District Hospitals in Mayo, Galway and Roscommon.
The move has led to concerns about the impact this may have on services across the region.
Hundreds of people attended a meeting in Belmullet last night, amid fears about staff cuts at the hospital in the town.
Organised by local Sinn Féin Senator, Rose Conway Walsh, the meeting heard calls for funding commitments and enhanced health service provision in the locality.
The HSE-run hospital in Belmullet has a 30 bed nursing unit, with a further 20 beds used for acute discharge patients, respite and palliative care.
But the executive says a significant overspend on agency staff means cutbacks are needed in the region.
It says costs were up by almost 25% in the first four months of the year, compared with the same period in 2018.
In addition to the restrictions on agency staff in Belmullet and elsewhere, temporary contracts are not being renewed at the hospital in north west Mayo.
And while there are no plans to reduce the number of beds in facilities in Swinford or Ballina, the HSE says the situation in Belmullet is under review.
Locals say they are not willing to countenance any cut in the number of short stay beds and will not tolerate a reduction in services either.
They have formed an action group and called on the Minister for Health to intervene to ensure that staffing levels are maintained in Belmullet.
There is a strong feeling in the locality that any diminution of services at the District Hospital could lead to further reductions in the future, with many locals referencing the manner in which bed capacity and step down services have been cut in recent times.
This evening, the Minister of State with responsibility for older people said he would travel to Belmullet in the coming weeks to view the hospital and "bring clarity" to service provision matters.
Minister Jim Daly said HSE management will also attend the meeting.
He said there are no plans to reduce services in the area.