The Public Accounts Committee said despite a 38% rise in funding between 2006/7 and 2009/10, emergency admissions rose 32%.
Its report, published last week, attacked the DH for failing to provide leadership on care for the two million people in the UK with neurological conditions such as Parkinson's disease and MS.
Richard Bacon MP (Conservative, South Norfolk) and charity Parkinson's UK called for a neurology czar that can champion best practice and hold local networks to account.
In 2005, the DH published the National Service Framework for Long-term Conditions to improve services. Health spending on neurological care rose from £2.1bn to £2.9bn in three years to 2009/10, while £2.4bn was spent on social services.
Although waiting times have fallen, services are failing to meet the framework’s standards, MPs found. Co-ordination of the complex care needed is poor, and there is still a lack of neurological expertise in hospitals and the community. Service access varies widely.
One in seven patients (14%) are readmitted to hospital within 28 days, a rise of 25% since the framework began. MPs said this represented worse outcomes for patients and a waste of NHS money.
As the government switches to more local decision making under the Health Bill, ensuring clear objectives and tracking outcomes will be ‘vital’, MPs concluded.
Mr Bacon said: 'Overall, the department’s failures were not about a lack of money, but a failure to take neurological conditions seriously enough.'
He added: 'It was heartless of the department not to see that failing to implement the framework for neurological conditions properly would send a very bad message to people living with serious illnesses such as Parkinson’s disease, motor neurone disease and MS.
'People facing such challenges will wonder why these conditions did not warrant the same attention to detail that the department gave to cancer patients and stroke victims.'
Committee chairwoman Margaret Hodge MP (Labour, Barking, east London) said: ‘The department needs to explain to the committee how it is going to ensure that all people with neurological conditions have appropriate access to services and how the department will ensure value for money.’
Care services minister Paul Burstow said he agreed NHS services should be better and said the Health Bill provides a ‘real opportunity’ to improve care.
Steve Ford, chief executive of Parkinson’s UK, said: 'A neurology czar would provide the proper leadership that is so desperately needed to sort out this crisis of care.'