A dedicated ward for British troops will be created at Birmingham's Selly Oak Hospital after an injured soldier was confronted by an anti-war protester, Defence Secretary Des Browne has pledged.
He made the promise in the House of Commons after it emerged injured soldiers fresh from Iraq and Afghanistan had been placed in mixed wards with civilians.
One wounded member of the Parachute Regiment had faced a verbal assault from a civilian as he was recovering.
The man was said to have told the soldier: "You have been killing my Muslim brothers in Afghanistan."
A relative of the injured paratrooper said that the soldier had feared for his safety.
But Mr Browne attacked Conservative politicians, who first raised the issue, accusing them of criticising medical staff.
He told MPs: "I want to challenge the notion that the current system is in any way inferior to what went before.
"In particular, the relentless attack on the work of the outstanding medical staff, military and civilian, in Selly Oak hospital is unfair and misplaced.
"It is one of the highest performing and most successful hospital trusts in the NHS and provides major specialist centres for trauma, burns, plastic surgery and neuroscience."
He added: "While some have been calling for a return to military hospitals, we have been quietly getting on with the job of establishing a military ward in partnership with the NHS at Selly Oak.
"I can confirm this will be operational in the near future."
But shadow Defence Secretary Liam Fox hit back, saying: "No-one has attacked the excellent work of the medical and nursing staff and to suggest that is deplorable.
"But to have injured servicemen and women and reservists treated in wards alongside civilian patients is just not acceptable.
"Part of the healing process is about coming to terms with the nature of their injuries and that is best done amongst their comrades."
More than 4,000 British soldiers have been flown home from Iraq for medical treatment since the start of the war in 2003.
Many have been treated in the Royal Centre for Defence Medicine, run by University Hospital Birmingham NHS Trust and the Ministry of Defence.
The centre uses the trust's sites in Selly Oak and the Queen Elizabeth Hospital.
Mr Browne also announced that troops serving in Afghanistan and Iraq will get annual bonuses of up to £2,240.
Around 15,000 troops on operations in hazardous areas - also including the Balkans - are to benefit from the flat-rate, tax-free payments.
Mr Browne said that British forces were already among the best paid in the world, but forces from other countries such as the US did not pay tax while on operations.
He said: "This has led some to demand that we do the same for our people. I think we can do better."
Offering a tax-free bonus meant half those on operations would be better off than under a tax exemption, especially the lower paid, he said.
Tony Blair described the extra money as the "fair thing to do" and admitted that military operations in the Middle East have proved far tougher than expected.
He said: "This recent campaign in Afghanistan, which is absolutely vital for our security and the broader security of the region and the world, has brought home to us that our troops today . . . are facing dangers and facing a type of conflict that a few years back they were unlikely to face."