Cottage hospitals are to be revived by Alan Milburn, the Secretary of State for Health, in an attempt to cut waiting lists for serious operations.
Family doctors are to be told they can take over the running of cottage hospitals from health authorities, to provide rest and recuperation for elderly patients who would otherwise occupy urgently needed beds in general hospitals.
The GP trusts that take over the whole of the healthcare services in their areas will be expected to use their own cottage hospitals to carry out minor surgery, diagnostic procedures and tests, cutting out the delays in waiting to refer patients to general hospitals.
"It's treating the right patients in the right places," said Mr Milburn, who is ready to approve the use of private nursing homes to take elderly patients to end so-called "bed blocking" in NHS hospitals. Nursing homes could be identified for use by the NHS as "active rehabilitation centres".
The revival of cottage hospitals is seen by the Secretary of State for Health as a patient-friendly reform.
The policy emerged as one of the central ideas from aconference of six NHS task forces to map out plans for reforming the health service, which was hosted by Mr Milburn at the QE2 conference centre in London.