Campaigners who took Worcestershire health authority to court, claiming a consultation exercise on plans to downgrade Kidderminster General Hospital was 'dishonest', have been defeated.
The HA wants to turn the hospital into a community hospital with a minor injuries unit as part of plans to re-focus acute services on Worcester.
Richard Taylor, chair of Save the Kidderminster Hospital campaign, said the public consultation exercise had been 'dishonest' because it only put forward one option.
Mr Justice Turner, sitting in the High Court in London, said he was not satisfied that the HA had not carried out sufficient consultation before choosing one option.
He also said the application questioning the decision was out of time.
The proposed changes are part of a package of measures to save£13m. Campaigners have accused the HA of 'sacrificing' Kidderminster's hospital in favour of a£100m private finance initiative project in Worcester.
But Worcestershire HA chief executive Pat Archer-Jones said the decision was not about 'one bit of the county gaining at the expense of the other'.
She said the plans 'are about developing primary care services' and 'improving the quality of services' while reducing the need for patients to travel to Birmingham for specialist treatment.
Managers are waiting for a decision on the future of Harefield Hospital in Hillingdon, west London.
Health secretary Frank Dobson is considering the recommendations of the west London review of cardio-thoracic services, which could lead to the closure of the site.
Options include moving all work to Royal Brompton Hospital, which merged with Harefield last year, building a heart and lung hospital near St Mary's Hospital in Paddington, keeping Harefield as a specialist centre and only relocating the hospital's transplant service.