The abuse uncovered by the BBC at specialist hospital Whorlton Hall has been condemned as "appalling" by a government minister.
Care minister Caroline Dinenage told the House of Commons she was "deeply sorry that this has happened".
Undercover BBC Panorama filming showed adults with learning disabilities and autism being mocked, intimidated and restrained.
A police investigation has been launched and 16 staff suspended.
BBC Panorama aired the footage of its investigation into the privately-run, NHS-funded hospital in County Durham on Wednesday.
It was the result of two months of secret filming by undercover reporter Olivia Davies. Her footage included shocking scenes where some staff can be heard using offensive language to describe patients, while another calls the hospital a "house of mongs".
Part of the abuse was described as "psychological torture" by experts.
On Thursday, Ms Dinenage - a minister at the Department of Health and Social Care - made a statement to MPs and called the footage "disturbing".
"The actions revealed by this programme are quite simply appalling, there is no other word to describe it," she said.
"I absolutely condemn any abuse of this kind, completely and utterly."
She added: "On behalf of the health and care system, I am deeply sorry that this has happened.
"One thing we can all agree on... what was shown last night was not care, nor was it in anyway caring."
Ms Dinenage said after the government and the Care Quality Commission were told of the allegations of abuse at Whorlton Hall, "immediate steps" were taken to ensure the safety of the patients there.
And she listed three questions that needed to be asked: whether the activity at Whorlton Hall was criminal; whether the regulatory and inspection framework is working; and also over the commissioning of care services.
BBC health correspondent Nick Triggle said one of the questions being asked today is why it took a BBC Panorama programme to expose this, and why the authorities did not spot what was happening.
"The Care Quality Commission had been in three times in the 12 months prior to Panorama going in and they didn't spot the serious problems that were happening," he said.
Dr Paul Lelliott, from the CQC, previously told Panorama: "On this occasion it is quite clear that we did not pick up the abuse that was happening at Whorlton Hall. All I can do is apologise deeply to the people concerned."
Speaking to MPs, Ms Dinenage added: "There are also a range of questions more broadly about whether these types of institutions and these type of inpatient settings are ever an appropriate place to keep the vulnerable for any extended length of time.
"Where it is essential that somebody has to be supported at distance from their home, we will make sure that those arrangements are supervised.
"We won't tolerate having people out of sight and out of mind. Where someone with a learning disability or an autistic person has to be an inpatient out of area, they will be now visited every six weeks if they are a child or every eight weeks if they are an adult."
BBC Panorama's investigation comes eight years after the programme exposed the scandal of abuse at Winterbourne View, another specialist hospital, near Bristol.
Winterbourne View was shut down and the government committed to closing other specialist hospitals too, saying care should be provided in the community.
Bed numbers have been reduced - from 3,400 to below 2,300 since 2012 in England - but that falls short of the government's target to get the figure down to below 1,700 by March this year.
Cygnet, the firm which runs the unit, said it was "shocked and deeply saddened".
The company only took over the running of the centre at the turn of the year and said it was "co-operating fully" with the police investigation.
All the patients have been transferred to other services and the hospital closed down, Cygnet said.
The Department for Health and Social Care said it treated allegations of abuse with the "utmost seriousness", but could not comment any further because of the police investigation.