Improve the bracketed part of the sentence.
I wish I (knew what was) wrong with my daughter.

The sentence uses the structure "I wish + past simple" to express a regret or desire about a present situation (that the speaker currently does not know what is wrong). The verb "knew" is correct here as it represents an unreal or subjunctive present state. The second part "what was wrong" maintains the tense harmony required by the indirect or hypothetical framework established by "wished/knew". Thus, the original sentence is grammatically sound and needs no improvement.