| The Health Insurance Portability and Accountability | | | | laws and standards directly apply to the following |
| Act or HIPAA, which was enacted by the US | | | | groups of health care entities: health plans, public |
| Congress in 1996, has introduced to sweeping | | | | and private payers, health care insurers, HMOs, |
| changes in health care administration and | | | | Medicare, Medicaid, group health plans, health care |
| information systems. HIPAA is a federal law that | | | | clearinghouses, any entity that facilitates the |
| has been amended to the Internal Revenue Code | | | | processing of non-standard formatted health |
| of 1986 which intends to improve portability and | | | | information and must convert the non-standard |
| continuity of health insurance; combat waste, | | | | data into standard transactions, or vice versa, |
| fraud and abuse in health insurance and health | | | | Health Care Providers, providers who transmit |
| care delivery; promote the use of medical savings | | | | health information electronically, providers who |
| accounts and improve access to long-term health | | | | receive individual health information, and providers |
| care services and coverage; and simplify the | | | | who electronically maintain health information used |
| administration of health insurance.HIPAA is | | | | in electronic transmissions between |
| designed to standardize the way all health care | | | | entities.Non-compliance with HIPAA regulations |
| organizations electronically exchange sensitive | | | | may cause disruptions in an organization's |
| patient data and to protect patients from | | | | day-to-day business processes, resulting in both |
| unauthorized disclosure of their medical records | | | | tangible and intangible costs. The most serious |
| (whether paper or electronic). Under HIPAA, there | | | | implications of HIPAA non-compliance for health |
| are specific standards that all health care | | | | care organizations include the inability to |
| organizations are required to adhere to. These | | | | effectively conduct electronic business and the |
| standards include an Administrative Simplification | | | | potential of losing significant segments of business. |
| Title that is aimed at preventing health care fraud | | | | The government also imposes some sanctions on |
| and abuse. Within this title, there are several laws | | | | those who fail to comply with the regulations of |
| and proposed standards including Electronic Health | | | | HIPAA. The penalty for failure to comply with |
| Transactions Standards, Privacy & Confidentiality | | | | regulations goes up to $100 per violation per |
| Standards, Unique Health Identifiers, and Security | | | | person up to a maximum of $25,000 per year. |
| & Electronic Signature Standards.These HIPAA | | | | |