Another $50 million will be spent over three years to support extra orthopaedic and general surgeries, and to create early intervention orthopaedic teams.
That would include hip, knee, shoulder and spinal surgeries, as well as general surgeries including hernia, vein and gall stone operations.
The $50 million commitment was announced during last year's election campaign.
Mr Key met patients while at Kenepuru Hospital and was talked through an operation on a prosthetic leg by surgeon Chris Hoffman.
Labour's health spokeswoman Annette King said today's announcement should be seen as what it is - a drop in the bucket.
"Jonathan Coleman has been under attack from all sides about the increasing numbers of Kiwis being rejected for a first consultation with a specialist or being kept out of operating theatres because they don't meet pain thresholds.
"At the same time he has repeatedly denied there's a problem. Now he thinks he's fixing it with $50 million over three years. Do the maths - that's on average $833,000 per year for each of the 20 district health boards."
Ms King has been on the attack in recent weeks over what she says is a significant underfunding of the health system, and about a recent memo that indicated the existence of a secret waiting list at one DHB.
On Saturday the Weekend Herald reported that a senior Waitemata DHB manager's memo indicated the DHB has been putting patients on a "suspended" waiting list for surgery until it can fit them in within the Government's new target of four months.
In January, the Government reduced the maximum waiting time to four months, from five, for patients offered elective surgery by DHBs. The ministry can penalise DHBs which repeatedly fail the targets by more than a small number of patients by withholding funding, more than $1 million a month for the larger boards.
Dr John Cullen, the director of the elective surgery hospital in Takapuna, told surgeons in the memo that the DHB is not adequately funded for the increasing number of patients needing elective surgery.
Dr Cullen warned in his covering email to another doctor that the "threshold" for access to elective surgery - how disabled or sick people have to be to get onto a waiting list - had been increased, which increased risks for patients.
The memo said: "Currently, in addition to a raised threshold, the situation is controlled by the use of a 'suspended list' where patients who have had their FSA [first specialist assessment] and a booking form for surgery completed are held and not entered into the system until they can be managed within the four-month time frame."
Following the statement, Dr Cullen told the Weekend Herald he had not expressed himself accurately in the memo and said there was no inappropriate use of the suspended list at the DHB.
In Parliamentary question time yesterday Ms King questioned Dr Coleman about the situation at Waitemata DHB.
In response, Dr Coleman said the memo had been retracted.
"Over the last six years at Waitemata DHB elective surgery has incresaed by 51 per cent - that is a total of 6500 more operations every year."
