Health insurance portability and accountability act of 1996 – Why was it created
Categories: HIPAA
Written By: admin
Health Insurance Portability and Accountability Act (HIPAA) of 1996 was created in United States of America in 1996. The bill was sponsored by Senator Nancy Kassebaum and Senator Edward Kennedy. HIPAA is divided in two titles:
- Title I
- Title II
Title I provides protection to employees and their families who lose their job and consequently, their healthcare. Title II provides guidelines to establish standards for the protection of national identifiers healthcare plans, employers and other providers and also the electronic healthcare transactions. Title II provides provisions for administration simplification which address privacy for medical data concerning the patients. These standards are created to make the health care system more efficient and effective by promoting Electronic Data Interchange.
The transmission of data between two organizations through electronic means is known as Electronic data interchange. Electronic Data Interchange is used to transfer medical data from one computer to another. EDI includes a number of standards, set up by the authorities.
Title II also defines a number of offenses and penalties related to health care. The Title sets up programs to control frauds, violations and abuse in health care system. According to this Title the Health and Human Services department must create rules to increase the efficiency in health care system and provide a fair and effective service to individuals.
HIPAA came into existence, after years’ of complaints by patients regarding misuse of their health records. The United States of America’s Government realized the need to create guidelines for the usage of medical records by health care officials, hospitals, insurance companies etc.
Before the introduction of HIPAA, individuals did not have any rights to promptly access their medical records and procuring them could take weeks as there was no standard procedure to record and store medical records. The law also ensures that an individual continues to have healthcare even after losing his or her job, for a considerable period of time. This gives the individual and his/her family protection until he/she finds a new job.
All in all, Health insurance portability and accountability act of 1996 has transformed the way medical records are used, disclosed and stored by covered entities.
