HIPAA and its Purpose

by | Jun 8, 2018

HIPAA (The Health Insurance Portability and Accountability Act) is an vital legislative Act that impacts the U.S. healthcare secor, but what is the purpose of HIPAA? Healthcare workers often complain about the limitations imposed by HIPAA – Are the advantages of the legislation worth the extra effort?

What is HIPAA’s Purpose?

HIPAA was enacted in 1996. In its initial form, the legislation helped to ensure that workers would continue to receive health insurance coverage when they were moving from job to job. The legislation also obligated healthcare groups to put in place controls to safeguard patient data to cut out healthcare fraud, although it took many years for the rules for doing so to be formulated.

HIPAA also heralded the introduction of many new standards that were intended to improve efficiency in the healthcare sector, requiring healthcare groups to implement the standards to reduce the paperwork burden. Code sets had to be used along with patient identifiers, which assisted in paving the way for the efficient moving of healthcare data between healthcare groups and insurers, streamlining eligibility checks, billing, payments, and other healthcare operations.

HIPAA also forbids the tax-deduction of interest on life insurance loans, enforces group health insurance requirements and standardizes the figures that may be saved in a pre-tax medical savings account.

HIPAA is a thorough legislative act the includes the requirements of several other legislative acts, including the Public Health Service Act, Employee Retirement Income Security Act, and more recently, the Health Information Technology for Economic and Clinical Health (HITECH) Act.

Most people are aware that HIPAA protects the privacy of patients and ensuring patient data is appropriately saefguarded, with those requirements added by the HIPAA Privacy Rule of 2000 and the HIPAA Security Rule of 2003. The requirement for alerting people of a breach of their health information was enacted in the Breach Notification Rule in 2009.

The aim of the HIPAA Privacy Rule was to bring in restrictions on the permitted uses and disclosures of protected health information, stating when, with whom, and under what circumstances, health information could be shared. Another critical purpose of the HIPAA Privacy Rule was to allow patients access to their health data on request. The aim of the HIPAA Security Rule is chiefly to ensure electronic health data is properly safeguarded, access to electronic health data is managed, and an auditable trail of PHI activity is managed.

So, in short, what is HIPAA’s purpose? To enhance efficiency in the healthcare sector, to enhance the portability of health insurance, to safeguard the privacy of patients and health plan members, and to make sure health information is kept safe and patients are alerted of breaches of their private health data.

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Daniel Lopez

Daniel Lopez is an experienced HIPAA trainer with a particular focus on patient privacy as the best way to ensure HIPAA compliance. Daniel serves as a subject matter expert for ComplianceJunction's online HIPAA training, using his teaching experience to ensure that the online training clear and practical. Daniel also contributes expert articles providing advice about HIPAA.

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