Australians will have three months to opt out of a "My Health Record" if they don't want one.
The healthcare records will be created for every Australian in November, allowing better treatment and reduced duplication of medical tests.
But Consumers Health Forum chief executive Leanne Wells said while the benefits were compelling, the privacy safeguards must be strong.
"Consumer trust and confidence in My Health Record is essential for its success," Ms Wells said on Monday.
The records allow important health information - including allergies, medical conditions, treatments, medicines, and test reports - to be securely shared between clinicians and their patients.
It also enables people to manage their children's health, and upload key documents like advanced care directives.
Health Minister Greg Hunt said the system has strong safeguards in place to protect the health data.
"It is also subject to some of the strongest legislation in the world to prevent unauthorised use," Mr Hunt said.
"Australians can cancel their My Health Record at any time after the end of the opt out period - or create one, if they opted out."
More than five million Australians already have a My Health Record, which provides a summary of their key health information.
The online opt-out period begins on July 16 and runs until October 15.
A month after that, every Australian who has not opted out will have a record created for them.
Mr Hunt said the plan has unanimous support from Australia's peak health bodies, including the Australian Medical Association president Michael Gannon.
"The current system of medical records means that we may have incomplete information on a patient - especially if the patient has recently seen another specialist or has been discharged from a hospital," Dr Gannon said.
"Less time chasing up paperwork means more time can be spent treating our patients."