Prime Minister Tony Blair has predicted only "a few hundred" compulsory redundancies in the NHS this year.
NHS trusts have announced staff cuts to tackle budget deficits
In his monthly press conference, Mr Blair said most staff cuts would involve posts remaining unfilled or people being moved to new positions.
NHS Employers suggests changes to services and financial instability may lead to up to 20,000 posts being axed.
The Tories said Labour had failed at running health services and the Lib Dems called Mr Blair "out of touch".
'Posts, not jobs'
Trusts around the country have announced staffing reductions and ward closures over recent months, but NHS chief executive David Nicholson said there was no central tally kept.
He insisted there would be "significantly fewer" than 20,000 posts lost.
Mr Blair said: "When you actually look at the announcements, most of it is vacancies that are not being filled or posts that are being transferred.
"The actual numbers of compulsory redundancies - which is what most people would understand by 'job losses' - as far as I can see from the figures I have got, is a few hundred, not 20,000."
Mr Nicholson told the Downing Street press conference a survey carried out by NHS Employers had suggested 20,000 posts might go.
But he said: "Our information is that it will be significantly less than that.
"In any one year, 130,000 people move jobs in the NHS, so you get quite significant turnover.
"We would expect most of the changes to be dealt with as part of that."
Asked specifically if there would be an overall reduction of 20,000 or more in the number of jobs in the NHS, he said: "We haven't got a complete figure at the moment, but we do know that the number of redundancies looks like significantly fewer than the numbers being talked about at the moment."
Mr Nicholson said he was "not being complacent" about financial difficulties, but deficits amounted to only 0.8% of the service's turnover.
Mr Blair said NHS staffing changes were partly caused by new technologies and working methods.
More patients with chronic conditions could now administer their own drugs and more people could be treated as day-cases or in clinics near home.
This was "a good thing, not a bad thing", Mr Blair insisted.
The majority of people's personal experience of using the NHS was good, but negative headlines made them believe the service overall was failing, he said.
But Shadow Health Secretary Andrew Lansley said: "This was a last-ditch attempt to claw back some credibility for Labour after their failure to manage our NHS."
Liberal Democrat health spokesman Steve Webb said: "The prime minister is totally out of touch with reality."
Pressure group Health Emergency has issued a dossier listing more than 20,000 staffing reductions announced by NHS trusts around the country since February.
Head of campaigns Geoff Martin said: "Tony Blair's attempt to play down the jobs carnage in the NHS is a kick in the teeth for thousands of NHS workers up and down the country waiting to find out if they next on the cuts hit list."