Death tally back with hospital gone from local area (7)
I believe the answer is:
Here is my best explanation:
'local area' is the definition.
The definition and answer can be both states of affairs as well as being singular nouns.
Maybe there's an association between them I don't understand?
'death tally back with hospital gone from' is the wordplay.
I cannot quite see how this works, but
'death' could be 'end' (synonyms) and 'end' is found within the answer.
'from' could be 'e' (I've seen this in other clues) and 'e' is found within the answer.
This explanation may well be incorrect...