A new Chief Inspector of Hospitals will name and shame failing NHS trusts in a shake-up sparked by the Mid Staffordshire scandal.
The new Chief Inspector will give hospitals Ofsted-style rankings for their performance and act as "whistleblower-in-chief".
If trusts fail to deliver, they could be put into a "failure regime" - the equivalent of special measures - and could end up in administration.
Failing NHS bosses will also be put on a blacklist to ensure they cannot just move to a different part of the organisation and keep working.
And NHS providers will have a new "statutory duty of candour" to ensure patients are fully informed if anything goes wrong with their care.
Trusts that fiddle mortality data figures could also face legal sanctions at a corporate level.
In further moves to restore a culture of compassion, student nurses will spend up to a year performing basic frontline work.
Initially under a pilot scheme, they will have to do a placement as a support worker or healthcare assistant in order to receive funding for their studies.
Health Secretary Jeremy Hunt unveiled the changes as he delivered the Government's initial response to the Francis report into Mid Staffordshire NHS Foundation Trust.
Robert Francis QC made 290 sweeping recommendations for healthcare regulators, providers and the Government.
As many as 1,200 patients may have died needlessly after they were "routinely neglected" at the hospital.
Many were left lying in their own urine and excrement for days, forced to drink water from vases or given the wrong medication.
The Health Secretary said the scandal was "a betrayal of the worse kind" and admitted it was "the NHS' darkest hour".
But he demanded that it become "not a byword for failure but a catalyst for change" as he set out a string of new measures.
He told MPs they would help embed a "culture of zero harm and compassionate care" with patients at its heart.
It is unclear how many of the 290 recommendations were taken up by the Government but a number of key measures were noticeably absent.
Mr Francis had called for a regulation system for healthcare assistants but Mr Hunt only announced a code of practice and minimum training standards.
He claimed a regulatory system would create a "bureaucratic quagmire".
The QC also wanted staff to be criminally liable as individuals if they harmed or killed patients but the Health Secretary is waiting on a further report before making a decision.
And instead of creating specialist registered nurses to look after elderly patients, Mr Hunt strengthened nurse training in the field.