Traffic and Highway Patrol Command, the Dog Unit and PolAir are searching bushland near Oxley Highway, where the prisoner, Matthew Furner, was last confirmed to be seen at about 8.15am.

Detective Chief Inspector Guy Flaherty, from the Mid North Coast Police District, said Furner allegedly "fled two security guards and he's run through the hospital into bushland nearby".

Det Ch Insp Flaherty said Corrective Services officers were monitoring Furner when it is believed he has escaped from the hospital during "a time of bathing and using toilet facilities".

The police search is concentrating on locations near the Port Macquarie racecourse.

Furner was transported to Port Macquarie hospital on Saturday, August 24 from Kempsey's Mid North Coast Correctional Centre.

Det Ch Insp Flaherty said Furner was being treated for injuries to his neck.

During the course of the incident, Det Ch Insp Flaherty said Corrective Services NSW discharged a firearm in bushland as a warning.

"That is being looked at in accordance with their policies," he said.

Matthew Furner is described as being of Caucasian appearance, 180cm tall, with a slim build and a shaved head with a rat's tail. He was last seen wearing prison greens (t-shirt and tracksuit pants).

"He also has a tattoo on his neck and he has some injuries to his neck which currently have surgical dressing on them," Det Ch Insp Flaherty said.

Det Ch Insp Flaherty said it's believed Furner is not from the Mid North Coast and is currently in custody pending trial on traffic offences.

Police are urging the community not to approach him if sighted, instead they should contact Triple Zero (000) immediately.

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