What is HIPAA?

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) has been defined as the most significant legislation to impact health care since the Medicare program of 1965. Many industry observers and analysts agree that HIPAA will significantly change the way the healthcare industry does business for many years to come.

HIPAA was enacted by Congress to bring about health insurance reform and to ensure that patient health information is not used for any un-intended or un-authorized purpose. The health insurance reform portion of HIPAA guarantees the availability and renew ability of health plan coverage, pre-existing condition waiting periods and the required notification associated with these coverage provisions.

Primary goals and objectives of this legislation include:

streamline industry inefficiencies and reduce paperwork
reduce health insurance fraud and abuse
guarantee security and confidentiality of individually identifiable health information
enable workers of all professions to change jobs, even if they (or family members) had pre-existing medical conditions

The Civil Rights Division of the U.S. Department of Health and Human Services has been given enforcement responsibility for HIPAA. Because HIPAA is federally regulated (like OSHA), violations of HIPAA standards carry stiff fines and criminal penalties - including imprisonment.

A number of HIPAA rules and requirements have yet to be finalized into law. These additional rules represent a continuing expansion of HIPAA and the challenges the healthcare industry already faces.

Click here to read more on the HIPAA Administrative Simplification.