A Birmingham health trust is underfunded by £12 million, an independent report has revealed.
Health watchdog the Healthcare Commission warned that Heart of Birmingham PCT, which provides GP and dental services in the Hodge Hill area, was receiving less money than it needed.
However, health trusts in other parts of the country were overfunded, the Commission said.
The warning was issued in the Commission's annual report on the state of the National Health Service.
Significant improvements had been made in cancer treatment and heart services, the report said.
However, other services have been left behind, such as sexual health, mental health, maternity and dental services.
The Commission also warned that a funding formula designed to ensure every area received its fair share of the NHS budget had still not been put into effect.
The formula was drawn up by the Government to end the " postcode lottery" which meant some health trusts got more money than others for no clear reason.
Instead, funding is now supposed to be based on the specific needs of different areas.
But it has proved difficult to cut spending in trusts which were above their target budget.
As a result, the funds are not available to distribute to health trusts which are below their target. Heart of Birmingham PCT is getting £12.1 million less than it should be, according to the Government formula.
This is 5.1 per cent of its total budget.
However, many wealthy parts of London are receiving far more than their target budget.
Westminster receives an extra £17.9 million, while Kensington and Chelsea receives an extra £19.5 million.
But the biggest winner is Trafford South, in Greater Manchester, which is given £54.7 million more than its target budget.
Heart of Birmingham runs 80 health centres and commission services from more than 150 GPs. It also buys services from dentists, pharmacists and opticians.
The report warned that, although the NHS had improved, it was still failing to meet the expectations of many patients.
Many people across the country have difficulty making an appointment with an NHS dentist, the Commission said.
Nearly 60 per cent of NHS dental practices are not taking on new patients, an increase from 40 per cent in 2001. In some areas, no dentists are taking on new NHS patients.
Sir Ian Kennedy, the chairman of the Healthcare Commission, said the health service was achieving "significantly better outcomes", particularly for people with cancer and heart disease.
He added: "People are not waiting as long for care in hospital. New ways of providing services, such as NHS Direct and walk-in centres, are helping to make services easier to obtain."
However the Government had not yet achieved its aim of creating a "patient-led NHS", he said.
"Our health services still have a long way to go before we can say that they are really putting patients first.
"Being an NHS patient is too often a frustrating experience. Services can seem fragmented and seem to be designed more to suit the needs of those providing them than those using them."