April 2001

Bush Okays Medical Privacy Rule

WASHINGTON - In what the U.S. secretary of Health and Human Services Tommy Thompson called "a bold and definitive step," President George Bush has decided to allow a sweeping medical records privacy rule issued in the waning days of former President Bill Clinton's administration to take effect as scheduled.

"President Bush wants strong patient privacy protections put in place now," Thompson said. "Our citizens must not wait any longer for protection of the most personal of all information -- their health records." Congress authorized the rule in mid-April under the Health Insurance Portability and Accountability Act of 1996 (HIPAA), which required Health and Human Services to issue it after Congress failed to act by 1999. Clinton issued the rule last December, after his administration received more than 54,000 comments from hospitals, doctors, insurance companies and patients' advocates.

As written, the rule requires in part that health-care providers, health plans and health-care clearing houses obtain written consent from patients before using their medical data for purposes of treatment, payment or health-care operations -- and even then, the rule requires that they share the "minimum necessary" amount of data.

The rule would also require covered entities to form contracts with business associates, such as billing-services firms, to ensure further privacy protections. Most health-care providers and insurers will have two years to comply with the rule. The HIPAA statute gives Thompson the authority to amend the rule after it takes effect, and Thompson signaled he will pay particular attention to the patient-consent provisions in the rule.

Although the final rule was published in December, the Clinton administration failed to complete formal notification to Congress, as required by a law that gives the legislature 60 days to scuttle new federal rules. Bush could have delayed the rules effective date even longer than the 60 days, but he chose to move forward instead.

On April 16, Thompson told HMOs and other managed care plans the Bush administration may make some of the changes the industry wants for the medical records privacy regulations.

Speaking to members of the American Association of HealthPlans, an industry trade group, Thompson said his department is committed to protecting patients' privacy. ``But our greatest concern is that these regulations not unwittingly block needed care,'' he said.

AAHP was one of many health industry groups to protest the regulations at the end of Clinton's term, saying they would ``reduce, not improve, consumers' access to quality care.'' The group also argued health-care costs would rise drastically if plans were forced to spend large sums of money to comply with the regulations.

Source: Reuters Health and Web Reports

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