1996 Health Insurance Portability and Accountability (HIPPA)

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This was talked about a lot back in 1999. It kind of dipped below my horizon. Very expensive and can California afford it after paying their power bills.

Patient-privacy law looks costly: Health industry fears grow By Lisa Rapaport Bee Staff Writer

(Published April 2, 2001) A sweeping federal patient-privacy law will cost California's public agencies, health care providers and insurers millions -- if not billions -- to implement. But it promises a brave new world where medical data travel securely through cyberspace, making it easier for workers to retain coverage when they change or lose jobs.

It's a law with an unwieldy name that many say represents the biggest change in American health care since the creation of Medicare in 1965.

Though it conjures Big Brother images for some, the law will assign each American a "unique health identifier" in the first nationwide citizen tracking system since the introduction of Social Security in 1935.

A state legislative report released last week said the state hasn't given the act and its implications the attention and money they deserve.

Ultimately, the 1996 Health Insurance Portability and Accountability Act, or HIPPA, will establish national medical data standards for administration, security and privacy.

While few in California's health care delivery system question the long-term benefits of HIPPA, many have raised grave concerns about short-term costs.

With the final privacy and security regulations still pending, the state already estimates its share of HIPPA costs at upwards of $100 million. For their part, California hospitals anticipate spending at least $2.5 billion.

Federal funds are available to assist Medi-Cal with compliance, but other public and private sectors of the state's health industry don't qualify for the money.

"We agree entirely with the concepts of HIPPA, and we can see how it will make many things easier after the one-time cost to implement it, but the law's costs come while the health care system is under huge financial stress," said Stan Rosenstein of the state Department of Health Services.

One of the state's biggest concerns is the law's implications for Medi-Cal billing. Where California has a multitude of procedure codes for Medi-Cal, the new nationwide standards will require the state to conform to a system with far fewer codes. The result, Rosenstein said, is that doctors may find it harder to accurately bill Medi-Cal, and state researchers may lose precision in gathering public health data.

Beyond worries over billing, hospitals' concerns about privacy provisions range from whether emergency room workers will be able to call out patient names in waiting rooms to whether doctors-in-training will still be able to track procedures on their Palm Pilots.

"This is going to cost more than Y2K and be much harder to deal with," said Nabil Musallam, who heads HIPPA compliance efforts at UC Davis Medical Center in Sacramento. "In Y2K we knew what we were trying to fix. With HIPPA, we know what the law is, but we don't know what changes in people's behavior we'll need to manage."

To some extent, the medical center and other hospitals are waiting to follow the state's lead, Musallam said.

A recent report by the state legislative analyst's office charges that the state has been remiss in failing to establish a lead agency or allocate sufficient funds for HIPPA compliance.

But states are to a large extent waiting for the federal government to unveil final privacy and security regulations, a process that has been slowed by millions of public comments on the guidelines.

Grantland Johnson, director of the state Department of Health and Human Services, said in recent months his agency stepped up efforts to brainstorm with public and private health providers.

"We're early in the game. It's important not to rush to judgment before we see the final regulations," Johnson said.

Down the line, hospitals expect countless daily tasks to become easier and cheaper as HIPPA data transaction procedures take hold, said Sherreta Lane of the California Healthcare Association.

Currently, when patients present their insurance card, hospital employees typically have to phone insurance companies to check benefits, Lane said. HIPPA will make this happen in a few key strokes, ultimately saving time and money.

Avoiding insurance fraud should also be easier with HIPPA.

"The hospitals are very much looking forward to the uniformity and the ability to use the same process to submit claims to Medi-Cal, Medicare and private insurers," Lane said.

For workers, the law is already delivering on its promise of better access to health insurance.

Since 1985, federal law allowed employees to keep their current insurance for 18 months from the date they left a job.

After this, many healthy people turned to the individual health insurance market for a new policy. But people with chronic illness often found it impossible to get coverage at any cost.

To be sure, the costs even with HIPPA can be as high as $400 to $500 a month, said Shelley Rouillard, program director of the Health Rights Hotline in Sacramento.

"If you can afford it, it's definitely a good thing," Rouillard said. "For adults in their fifties and early sixties, HIPPA may be their best chance for coverage."


-- Martin Thompson (mthom1927@aol.com), April 02, 2001

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