Three wards are to close at Chelmsford's Broomfield Hospital before the end of the year in a bid to save £1.75 million.
Mid Essex Hospital Services NHS Trust, which runs the hospital, made the announcement as it tries to combat debts of £2.4 million.
The wards earmarked for closure are acute elderly wards and wards treating patients with chest pains.
Health bosses say the wards can go as they currently house "bed blockers" who can receive treatment elsewhere.
The Trust plans to place these patients in community hospitals in Braintree and Maldon.
Simon Burns, MP for Chelmsford West, said he was "staggered" by the news, just days after he confronted the Prime Minister in the House of Commons about rising waiting lists in the area.
"I'm staggered in that it has come to me as a bolt out of the blue. I had no indication it was happening," he said.
From the end of August wards B12 and B13 will be used to treat patients who need intermediate care but by September the two will have been phased out and will close permanently.
Ward B10 will also be closed for good after the patients in there are moved to another ward.
The closure will mean the loss of up to 80 beds and nurses will be redeployed into areas where they are most needed.
The news has been met with outrage by the health workers union, Unison, who have declared it an "absolute disgrace".
Branch secretary, Andy Slade, said:"There is already a shortage of beds and now they want to close them.
"B12 and B13 were the wards upgraded only 12 months ago to take patients from St John's Hospital in Chelmsford."
But Russell Griffiths, communications manager for the Trust, said the move to close the wards was the final "push" of a scheme to reduce bed blockers and financial problems.
"We do not have a shortage of beds and this is the best way we can see to reduce the problem of people being on the wards when they would be better placed elsewhere.
"The waiting lists have no bearing on the amount of beds. In the past we have found the problem has been down to not having the qualified staff to carry out the work," added Mr Griffiths.
He denied there were plans to close down any more wards at the hospital.
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