Leicester's hospitals have lost out on nearly £1.4 million because they are not treating accident and emergency patients quickly enough.
The financial penalty has been imposed by the Leicester, Leicestershire and Rutland primary care trust (PCT) after Leicester Royal Infirmary failed to hit its target of seeing and treating 95 per cent A&E patients within four hours.
Just over 89 per cent of 14,201 patients were seen within the target time last November.
The department has met the target in just three of the eight months between April and November last year.
Health campaigner Zuffar Haq said: "This is a crazy scenario. Leicester's hospitals are effectively being fined for seeing too many patients in accident and emergency.
"The hospital should be given extra resources, not have them taken away."
Jeremy Tozer, interim director of operations at Leicester's hospitals, said: "We have already begun looking at ways to streamline what we do in the emergency department and we have worked with the clinical commissioning groups to develop a joint recovery plan to improve overall performance."
Changes have been made to try to speed up processes such as getting X-rays and blood tests.
A payment of £688,000 was first withheld from Leicester's hospitals in October last year.
At the time, Simon Freeman, managing director of the Leicester City clinical commissioning group, which oversees the contract and which will take on responsibility for city health services in April, said the cash might be paid if the November target was met – but that has not happened.
A report to be discussed by PCT directors today states: "As UHL (Leicester's hospitals) has not recovered the 95 per cent cumulative performance (July to November 2012), the October penalty will not be returned and a further penalty will be levied for the November 2012 performance."
A PCT spokesman said the November penalty amounted to £683,000.
A new plan has also been drawn up with the clinical commissioning group to try to make sure patients are seen within the target time.
The commissioning group is also testing a scheme in which GPs are available to make urgent home visits to patients.
There is also a campaign to encourage patients to contact their GP if feeling unwell.
