The new National Children's Hospital could end up costing more than €700 million, due to inflation in the construction sector.
That total would be €60m more than previous Government estimates.
The new hospital is expected to be built on the campus of St James's Hospital in Dublin.
However, a final decision on planning permission will not be made by An Bord Pleanála until May.
Journalist with the Irish Times, Fiach Kelly, says inflation costs have been higher than expected but savings could be made elsewhere.
Speaking to Newstalk Breakfast, Fiach explained that "it was anticipated that the rate of inflation in the building industry would be 3%. It is our understanding that officials were told that would be 7.5%.
"[However] there are some people who suggest that, because this is such a landmark project, that you might get developers low-balling their tender to basically get the privilege and honour of having built this facility," he suggested.