The government has come under sharp criticism for refusing to create a new stand-alone medical school to help boost the number of trainee doctors' places by 1,000.
The decision to reject proposals by the Open University has also disappointed a number of schools which worked jointly with it.
The Higher Education Funding Council for England and the Department of Health have given 158 places to existing medical schools for this autumn's intake, with a further 684 for 2000-01.
Among the biggest losers is the Open University, which put forward bids to establish a school with Plymouth and Exeter universities, and for extra places at Leeds University. The OU and its partners have been asked to work up their proposals ahead of a final decision in spring 2000. The University of East Anglia has also been asked to re-examine proposals for a stand-alone medical school.
Professor Alan Maynard, director of the centre for health economics at York University, described the plan as 'predictably conservative'.
'It's unfortunate that there hasn't been a more radical response.'
The practical difficulties of training more students were raised by Lizz Corps, chair of the British Medical Association's medical students committee. 'Teaching facilities have to be expanded and there must be safeguards on the wards against overcrowding. '