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The government has been putting ambulance performance targets before value for money and clinical outcomes for patients in recent years, according to a report.
The National Audit Office (NAO) found it can take more than 15 minutes for patients to be transferred between teams during an emergency, meaning ambulances are unable to attend other calls.
Its report, 'Transforming NHS ambulance services' also identifies "wide variations" in efficiency between NHS trusts.
And it found that so far the system is yet to deliver the best value for money.
The study said that if all ambulance services achieved what the best in the country is managing, the NHS could save £165m a year.
The audtiors welcomed the move in April 2011 to make the response target a part of a range of indicators designed to encourage a broader, outcome-led performance regime.
However, it warned that for this to be an accurate measure, trusts and accident and emergency departments will need to share data with the ambulance service.
And it identified other inefficiencies in the system, for example, the cost per incident varies between trusts from £176 to £251.
NAO head Amyas Morse said: "The time taken to respond to calls has until recently been the be all and end all of measuring the performance of ambulance services.
"Illustrating the principle that what gets measured, gets done, the result has been a rapid response to urgent and emergency calls. However, this led to an increase in the number of multiple responses to incidents equating to millions of unnecessary ambulance journeys."
Responding to the report, health minister Simon Burns said: "This report is clear evidence that Labour's perverse fixation with bureaucratic target distorted clinical priorities and undermined patient care."
Burns said the report showed the NAO was endorsing the government's focus on a wider range of patient outcomes and wider reforms to the health service.
However health union Unison said that proposals in the Health and Social Care Bill would lead to multiple commissioning bodies which would "get in the way of providing the holistic model of healthcare provision" advocated in the report.
It said instead there should be one national commissioning body and more trained staff to deal with 999 calls. And that previous time-driven targets had led trusts to employing support workers instead of qualified paramedics..
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