Lawyers looking to drum up compensation claims against the NHS will be banned from advertising or working in hospitals from next month.
From February, law firms and claims management companies will be denied office space or advertising opportunities and NHS England said "every effort" should be made to prevent them from approaching patients or families in hospital without permission.
The health service spent £1.7 billion on clinical negligence claims in 2016/17, with legal costs accounting for an estimated 36% of the total bill, according to the latest NHS Resolution figures.
The changes to the NHS Standard Contract were first outlined last March in the Next Steps section of the NHS Five Year Forward View.
At the time, NHS England chief executive Simon Stevens said: "We want lawyers out of hospital and doctors out of court."
The ban, which will not impact on law firms who run pro bono schemes in major trauma centres, will come into force on February 1.
An NHS England spokesman said: "Money spent defending speculative legal claims is money hospitals can't then spend on looking after patients.
"That's why legal firms who pursue the NHS should not advertise in or operate from our hospitals.
"From February, trusts are now prohibited from entering or renewing agreements with firms who want to sue them.
"Staying in hospital is often a traumatic experience, one that is made worse by lawyers soliciting patients or their families for business - a practice we are also calling on Trusts to do all they can to stop."