At least 10 major hospitals are facing closure or cut-backs, with some facing the end of emergency care, the BBC said.
The sites in London, Surrey, Sussex, Lancashire and Cornwall will either close or have their facilities downgraded to handle basic care in order to get back into financial health, after an unprecedented level of NHS debt was revealed earlier in the summer.
Nearly a third of NHS trusts ended the year with a combined gross deficit of pounds £1.27bn.
The Department of Health said it was up to local NHS trusts to decide on the appropriate level of services for their area.
The health secretary, Patricia Hewitt, has staked her career on restoring the NHS to financial balance by next March.
A spokeswoman said: "In some areas there are too many hospitals providing the same, or similar, services which isn't value for money and means less money for other forms of healthcare.
"In those areas it is up to the local NHS to determine the best way of delivering high quality care and the best way to reconfigure those services."
The report was broadcast on the day the government announced today that six new hospitals costing £1.5bn would open across England from 2010 under the private finance initiative (PFI).
Up to half the beds at the hospitals will be in single rooms "in a shift away from large, public wards", the Department of Health said.
But critics said PFI is a "money-making racket" for private companies and represents a waste of money.
Under the plans, hospitals will be built in Leicester, Torbay, North Staffordshire, Tameside and Glossop, Salford and Walsall.
Health minister Andy Burnham said the scheme would lead to new A&E departments as well as cancer and mental health facilities.
The biggest hospital-building programme in the history of the NHS had now passed the £10bn mark, he added.
"New facilities like these are replacing inadequate and outdated hospitals across the country. The go-ahead is great news for the hundreds of thousands of patients who will benefit from the modern, bright, new buildings.
"The new facilities will not only be the best in terms of design and quality, but they will be affordable well into the future.
"Each scheme has been rigorously checked to make sure that it offers value for money and delivers services that are needed by local patients."
Under PFI, hospitals are built by private companies, with NHS trusts repaying them over a period of around 25 or 30 years.
The projects have caused deep controversy, with some projects running into severe financial problems.
Reports in 2002 by the National Audit Office (NAO) and the Commons public accounts committee highlighted private companies' ability to make significant sums by refinancing debts to take advantage of improved interest rates.
Earlier this year, the NAO raised concerns over the financing of the Norfolk and Norwich University Hospital after it found that private investors made more than £80m out of a refinancing deal while the hospital was only handed £34m.
In December, the Queen Elizabeth Hospital in Woolwich also cited PFI when admitting it had become technically insolvent.
Mike Jackson, senior national officer at Unison, which has persistently campaigned against PFI deals, said: "Of course we welcome news that patients will benefit from bright, new hospital surroundings, but using PFI to finance these schemes is a waste of taxpayers' money.
"PFI schemes are expensive, inflexible and are adding to the current financial burdens of many hospital trusts.
"Government claims that these schemes have been subject to extra scrutiny don't stack up, because PFI is fundamentally flawed.
"We don't want to risk waiting another five years to find out they were wrong again and more of our money has gone down the drain. These new schemes tie hospitals into 30-year plus contracts for services such as cleaning, catering and portering.
"They allow PFI companies to sweat even more money from the contracts. Time and time again PFI companies milk these projects through overcharging and lucrative refinancing deals.
"These new hospital schemes could and should be paid for by much cheaper public sector borrowing."
Geoff Martin from the pressure group Health Emergency said: "For the government to be signing off a new raft of PFI schemes, despite the fact we know they are extremely bad value, are a money-making racket for the private sector and provide poor quality facilities, flies in the face of any kind of rational thought process."
A total of 58 hospital projects have been completed under PFI with another 30 under construction, according to the Department of Health.
Meanwhile, the former headteacher of one of the first secondary schools to be built through PFI said the initiative had "crippled" the school.
Monica Cross, who resigned in April as head of Highlands School in Enfield, north London, told the Daily Telegraph: "It was naive to think that a commercial company would have a social conscience.
"It's a huge waste of public money. We could only afford the bare essentials for our pupils because so much of our budget was going on the PFI scheme."
