Location of hospital drama? (7)

I believe the answer is:

theatre

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'drama?' is the definition.
(theatre can mean the world of drama)

I don't understand the rest of the clue.

(Other definitions for theatre that I've seen before include "place of action" , "within which one may operate" , "Location for plays and operations" , "Scene of operations or dramatic performances" , "Room for surgery" .)

I've seen this clue in the Evening Standard.

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