The NHS has been banned from attempting to save money by enforcing minimum waiting times for patients following referrals.
The move was announced by Andrew Lansley MP, the Health Secretary, in response to a Co-operation and Competition Panel report earlier in the year.
It found that Primary Care Trusts (PCTs) were often installing minimum waiting times for patients after being referred for certain operations in an attempt to save money and ration treatment.
The measures had become necessary as NHS budgets are increasingly stretched and PCTs face making £20bn of efficiency savings.
However, managers will now need to find other ways in which to make some of the savings required.
Lansley announced that he was banning the practice and would also introduce caps on operations that do not take account of the healthcare needs of individual patients.
A Department of Health statement said: ‘By March 2012 at the latest, all PCTs will be expected to have removed these unfair restrictions which limit patient choice and pro-long unnecessary suffering for patients.
‘All decisions that could impact on patient choice must now be taken at PCT Board-level and must be made public.'
Lansley added: "This is just the beginning of a range of measures we hope to introduce to make the NHS truly patient focused.
"I want a health service that works around patients - not the other way around.
"PCTs have to manage resources carefully but they must do so without restricting patient choice, that's why I am taking firm action today and banning these unfair measures imposed on patients."