What Is HIPAA and Why It Is Important in Healthcare?
HIPAA (Health Insurance Portability and Accountability Act) was passed in the year 1996 to safeguard the interest of the patients. At that time, it was felt that those individuals who have lost their jobs or were in a vulnerable position in their jobs.
Most insurance companies were not providing them with any health cover during this period which created a heavy financial drain on the resources of such individuals. Besides, there was no legislation that protected the sensitive information of the patients from data thieves.
When HIPAA legislation was enacted, it tried to streamline the data protection measures across the healthcare industry. As the healthcare industry is dynamic in nature, this important legislation was also amended a few times to ensure that it remains relevant with the times and is able to tackle the issues that have cropped up with the changing technology. If we look at the broad contours of HIPAA, we will find that it has 5 main rules:
1). Privacy Rule: This rule deals with protecting the medical records and PHI of the patients. It has some conditions and limits on the uses and the disclosure of the sensitive information in special circumstances. This rule allows an individual to demand a copy of his medical record so that he can inspect it and make corrections if any error has inadvertently crept into the system.
2). Security Rule: This rule was made to protect the privacy of personal medical records. It sets the standards, methods, and processes that health industry has to follow for the protection of the data on storage, accessibility, and during transmission. It has three different levels of safeguards built in to provide comprehensive security for the patient data.
- Administrative safeguard that deals with HIPAA security compliance team
- Technical safeguard which relates to encryption and authentication for secure data access
- Physical safeguard that deals with the protection of data storage unit within the organization facility
3). Transaction Rule: This rule relates to the transaction codes that are used in the HIPAA transaction. These codes are crucial as they ensure safety, security, and accuracy of the medical history of an individual.
4). Identifiers Rule: This rule is related to three unique identifiers that use HIPAA rules for administrative as well as financial purposes.
- National Provider Identifier (NPI)
- National Health Plan Identifier (NHI)
- Standard Unique Employer Identifier
5). Enforcement Rule: This rule is about the penalties and fines imposed on any data breach by the companies that have the custody of the medical reports of the patients.
While the HIPAA rule was enacted to protect the privacy of an individual, but this law is not absolute, has certain limitations. These limitations are put in the legislation so that it allows the smooth functioning of the health sector and there is a qualitative improvement in the quality of services in health centers.
What Are the Penalties Imposed for HIPAA Violations?
In case there is any violation to the HIPAA rule then the authorities have the power to impose penalties which vary depending on the breach. The penalty depends on willful leak or leak done unknowingly. Besides, the court also looks at the number of times leak had taken place from the same individual/office before imposing the quantum of penalties.
Wrapping Up,
We hope after reading this article, you will have a clear picture of why HIPAA is important. Now it’s time for you to go back and review all types of information that you are collecting to assess whether you actually need to be HIPAA compliant or not.
HIPAA legislation is changing constantly and although it seems complicated, it’s imperative to ensure that everyone is in compliance. As one must be completely aware of these HIPAA directives, one needs to be prepared for the changes too. With continuous Healthcare reforms and other disruptive movements, this industry needs flexibility.
Read further to know more about HIPAA directives.