Today's hospitals 'need fewer beds'.
Technological developments and changes in the way patients are treated mean fewer hospital beds are needed, according to the NHS Confederation.
It called for an end to the "fixation" with bed numbers and the "bricks and mortar" of hospital buildings.
Instead, it wants a new emphasis on investment in staff, medicines and technology.
In a briefing paper, the confederation ( which represents 90% of NHS organisations ( acknowledged that bed closures caused "emotions to run high, both publicly and politically".
It called for an "informed debate" about where future spending priorities should lie. Opposition parties warned, however, that the paper must not be an excuse for the Government simply to cut more hospital beds.
The paper points out that NHS bed numbers have been falling since the end of the 1950s.
Between 1984 and 2004 there was a decrease of almost a third, from 211,617 to 145,218.
At the same time, more people were being treated faster and more effectively than ever before, it said.
NHS chief executive Dr Gill Morgan said: "We need to move away from this fixation with bricks and mortar. The world is changing, patients' needs are changing and the NHS is adapting to meet those needs. We must start judging the NHS by the number of people we make better and keep well, not by the amount of beds which are, after all, only hospital furniture.
"Developments in technology and changes in the way treatment is delivered mean we simply need fewer beds."
The paper argued that advances in treatments such as chemotherapy drugs which could now be administered at home, the growth of day and short-stay surgery, and improvements in the management of emergency care had all eased the pressure on beds.
However, shadow health secretary Andrew Lansley warned against running down hospital bed numbers at a time when there was insufficient support for patients in the community.
He said: "Reducing the number of beds in hospitals must crucially depend upon the availability of community resources, especially community nursing.
"We run a severe risk of shutting down hospital capacity when the community services cannot cope and it will be patients who suffer the consequences."
Liberal Democrat health spokesman Steve Webb said that despite the report's claims, there was a shortage of beds, with some NHS trusts urging GPs not to refer patients to hospital because there was no room for them.
He said: "There is a real danger that this report will be used by the Government as an excuse to cut hospital beds, when the system today is already often over-stretched.
"While new ways of delivering care are welcome and may reduce pressure on beds, the ageing of our population will work in the opposite direction.
"There must be no premature bed cuts unless clear evidence exists that they are not needed."