The government is pushing ahead with the controversial electronic care records system - but has agreed to give patients a veto.
There are fears the system will not be secure
Ministers said the system, part of a 10-year, £6bn upgrade of NHS IT, was about improving care.
It will mean doctors across England will be able to access records containing data on medication, allergies and adverse drug reactions.
But patients will be allowed to veto their records being shared nationally.
Doctors and patients have expressed fears a compulsory electronic record system could damage the GP/patient relationship, and compromise confidentiality.
And a poll of over 1,000 GPs by the Guardian newspaper last month found half would consider refusing to put patient records automatically on to a new national database.
But until now ministers have argued e-records were necessary as the current paper-based system risked patient safety.
One of the complaints was that it causes delays in emergency hospital treatment while doctors contact GPs for patient details.
Pilots will start in the spring, and the government is also setting up an advisory group to look at just how the veto can be achieved.
It is envisaged that patients will be able to access their records online before they are put on the national database, enabling them to amend details or prevent it being shared.
If patients do not register their opposition to electronic records at this stage it will be assumed they are consenting.
Patients can also object before it is even put on to computers by arguing having an electronic record was cause them significant mental distress - under data protection laws the government is required not to store them if this is the case.
The U-turn was prompted by a report led by patient's tsar Harry Cayton, which argued the system must be introduced with "public support and clinical confidence".
How more sensitive data, such as HIV status, will be held electronically is still being considered.
Health Minister Lord Warner said: "We are going forward cautiously. We believe that despite the noise it has generated patient care records will be of huge benefit to patients' care.
"We believe there are some myths about how effective the current arrangements are in regards to safety."
The new system will be designed to link more than 30,000 GP surgeries in England electronically to nearly 300 hospitals. Potentially, it will hold records for 50m people in England.
The move by the government has won the backing of the doctors' trade union which to date has remained suspicious of the plans.
James Johnson, chairman of the British Medical Association, said: "The recommendations provide a good first step and we look forward to building on this work."
But Liberal Democrat health spokesman John Pugh said: "The government is clearly making this up as they go along.
"Without real clarity and meaningful assurances, the NHS IT system risks being yet another expensive bureaucratic mess that undermines civil liberties.
"It is crucial that we have real clarity on the terms and conditions of the private information available and concrete rules about how people can opt out before the system is launched."