A new generation of 50 cottage hospitals with modern diagnostic and treatment facilities are to be built across Britain as part of a drive to bring care closer to patients' homes.

More than two million out-patient appointments a year, one in 20 of the total, will be switched from costly traditional district hospitals to GP surgeries and community hospitals over the next decade under proposals in a White Paper unveiled by Patricia Hewitt, the Health Secretary.

Ms Hewitt ordered a moratorium on the closure of community hospitals to save cash except where they were not viable or not wanted. She told health authorities to reconsider their future in light of an expanded need for health care in the community.

The plans, which reflect advances in technology that mean more sophisticated treatments can be delivered in the surgery or in patients' homes, will give a boost to GP services with longer opening hours for practices, regular "life checks" for patients to detect disease early and easier access to care.

But doctors warned that keeping patients out of hospital would increase pressure on the already stretched finances of England's large district hospitals.

One in four NHS trusts in England is facing a deficit at the end of this financial year and 18 are in such serious financial trouble that ministers have ordered "turnaround teams" of private accountants to go in to help them make cuts.

Ms Hewitt said almost 90 per cent of patients were treated in the community for only 27 per cent of the NHS budget, less than the 33 per cent spent in other European countries.

"Over the next10 years I want to see 5 per cent of resources shifted from secondary [hospital] care to primary [GP] care which will help to make primary and community services responsive to patients' needs," Ms Hewitt said.

Hospitals are already under pressure from the introduction of patient choice and payment by results, in which money follows the patient and unpopular hospitals lose out.

Ms Hewitt rejected suggestions that measures in the White Paper to increase the number of patients treated in the community would add to the pressure and could lead to hospital closures. But she conceded that NHS trusts might "expand staff in community hospitals and reduce it in acute hospitals".

The Royal College of Physicians warned about the implications of the changes. "It is vital that acute hospitals retain a critical mass to maintain their viability and safety during the transitional period," it said in a joint statement with the Royal College of General Practitioners.

The White Paper proposes that private operators including Boots and Bupa will be allowed to compete to run GP services in deprived areas which are short of doctors.

An increased part of GPs' pay will be made dependent on the number of patients they can attract, encouraging successful practices to expand. Patients will be asked for their opinions on the service, including the opening hours, which will in part determine GPs' pay.

But ministers have abandoned plans for "dual registration" which would have allowed patients to register with a GP at home and work to ease access problems.

The British Medical Association welcomed the strategy but warned there was a shortage of capacity. "We cannot stretch our existing workforce any further," said Hamish Meldrum, the chairman of the GPs committee.

The Liberal Democrat health spokesman Sandra Gidley said the White Paper was a "hot-potch of ideas" that would please nobody. "The Government proposes to build another 50 community hospitals but at present funding crises mean that one in four are threatened with closure."

The shadow Health Secretary, Andrew Lansley, mocked Ms Hewitt's plans as "Patricia's Adventures in Wonderland". He warned: "Primary care trusts are cutting back now on precisely those services on which your White Paper depends."

There are 350 community hospitals of which between 50 and 100 are under threat of closure by local health authorities, according to the health department.

Main points in White Paper

* 50 new or refurbished community hospitals offering minor surgery and out- patient appointments.

* "Life checks" to be offered at five points in a patient's life to assess health risks.

* New incentives for GPs to take on extra patients and offer longer opening hours.

* Private companies to be invited to bid to provide GP services in deprived areas where there is a shortage of doctors.

* 2.25 million outpatient appointments - one in 20 of the total - to be shifted from hospitals to primary care over the next 10 years.

* More support for people with long-term health needs and their carers.

* Bringing hospital specialties including dermatology, ear nose and throat medicine, orthopaedics and gynaecology into the community.