White House to Issue New Medical Privacy Protections
The Clinton administration is expected to release "sweeping new rules" aimed at protecting the privacy of medical records within the next few weeks, although the regulations will not give patients a "broad new right to sue" HMOs and medical providers for breaches of privacy, the
New York Times reports. The new rules constitute the "first comprehensive federal standards" to protect the privacy of medical information, and will affect "virtually everyone who receives or provides health care in the United States," according to the Times. The new standards mark the first time consumers will have a federal right to inspect and copy information in their medical records, and will also have the right to request correction of data they believe to be "inaccurate or incomplete." Under the new rules, HMOs and other health care providers, such as doctors, nurses, hospitals, nursing homes, pharmacies and medical laboratories, would be restricted in how they could use and disclose patient information. Health care providers would have to rewrite contracts with their "business associates," which include lawyers, auditors, accountants, consultants, billing companies and other contractors, to guarantee that patient information is kept confidential. The new rules have garnered criticism from some in the health industry. "The rule on business partners is very controversial. It imposes new obligations on health care providers and health plans, making them responsible for someone else's mistakes," Jackie Huchenski, a New York health lawyer, said. Paul Sherwood, senior vice president at Halifax Regional Medical Center, said it is "unrealistic" to hold him accountable for his business partners' actions. "I have very little control over my contractors," he said. Although the new Congress could change the rules, it would "have great difficulty mustering a consensus for any alternative" to them, the Times reports.
"Pressure" from the health care industry led to the exclusion of legislation that would give patients the right to sue, the Times reports. Federal officials had originally included a clause requiring patients to be named as the "intended third-party beneficiaries" of contracts between health care providers and their business associates. That clause would have allowed patients to sue in state court for violation of the contract if their medical information was improperly divulged. The proposal was scrapped after federal officials received a "torrent of criticism" from the health care industry, which "complained" that the federal government had "exceeded its legal authority" by including it. The American Association of Health Plans said its members would have faced "significant new legal liability" under the regulation, while the Health Insurance Association of America said it would have led to "excessive litigation ... that would drive up health care costs." Even without the clause, some health providers believe the new rules will lead to a deluge of lawsuits. Sherwood said, "The proposed rule appeared to be inviting a plethora of litigation." Huchenski added that even without an explicit new right to sue, patients may be able to recover damages by filing suit under certain existing state laws that protect consumers or regulate health care (Pear, New York Times, 11/20).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.