Standards for Privacy of Individually Identifiable Health Information. Final Privacy Rule Preamble.. Section 164.502(a) - General Standard

12/28/2000

Comment: A few commenters requested an exemption from the rule for the Social Security and Supplemental Security Income Disability Programs so that disability claimants can be served in a fair and timely manner. The commenters were concerned that the proposal would be narrowly interpreted, thereby impeding the release of medical records for the purposes of Social Security disability programs.

Another commenter similarly asked that a special provision be added to the proposal's general rule for uses and disclosures without authorization for treatment, payment, and health care operations purposes to authorize disclosure of all medical information from all sources to the Social Security Administration, including their contracted state agencies handling disability determinations.

Response: A complete exemption for disclosures for these programs is not necessary. Under current practice, the Social Security Administration obtains authorization from applicants for providers to release an individual's records to SSA for disability and other determinations. Thus, there is no reason to believe that an exemption from the authorization required by this rule is needed to allow these programs to function effectively. Further, such an exemption would reduce privacy protections from current levels. When this rule goes into effect, those authorizations will need to meet the requirements for authorization under § 164.508 of this rule.

We do, however, modify other provisions of the proposed rule to accommodate the special requirements of these programs. In particular, Social Security Disability and other federal programs, and public benefits programs run by the states, are authorized by law to share information for eligibility purposes. Where another public body has determined that the appropriate balance between need for efficient administration of public programs and public funds and individuals' privacy interests is to allow information sharing for these limited purposes, we do not upset that determination. Where the sharing of enrollment and eligibility information is required or expressly authorized by law, this rule permits such sharing of information for eligibility and enrollment purposes (see § 164.512(k)(6)(i)), and also excepts these arrangements from the requirements for business associate agreements (see § 164.502(e)(1)).

Comment: A few commenters asked that the rule be revised to authorize disclosures to clergy, for directory purposes, to organ and tissue procurement organizations, and to the American Red Cross without patient authorization.

Response: We agree and revise the final rule accordingly. The new policies and the rationale for these policies are found in §§ 164.510 and 164.512, and the corresponding preamble.

Comment: One commenter recommended that the rule apply only to the "disclosure" of protected health information by covered entities, rather than to both "use" and "disclosure." The commenter stated that the application of the regulation to a covered entity's use of individually identifiable health information offers little benefit in terms of protecting protected health information, yet imposes costs and may hamper many legitimate activities, that fall outside the definition of treatment, payment or health care operations.

Another commenter similarly urged that the final regulation draw substantive distinctions between restrictions on the "use" of individually identifiable health information and on the "disclosure" of such information, with broader latitude for "uses" of such information. The commenter believed that internal "uses" of such information generally do not raise the same issues and concerns that a disclosure of that information might raise. It was argued that any concerns about the potential breadth of use of this information could be addressed through application of the "minimum necessary" standard. The commenter also argued that Congressional intent was that a "disclosure" of individually identifiable health information is potentially much more significant than a "use" of that information.

Response: We do not accept the commenter's broad recommendation to apply the regulation only to the "disclosure" of protected health information and not to "use" of such information. Section 264 charges the Secretary with promulgating standards that address, among other things, "the uses and disclosures" of individually identifiable health information. We also do not agree that applying the regulation to "use" offers little benefit to protecting protected health information. The potential exists for misuse of protected health information within entities. This potential is even greater when the covered entity also provides services or products outside its role as a health care provider, health plan, or health care clearinghouse for which "use" of protected health information offers economic benefit to the entity. For example, if this rule did not limit "uses" generally to treatment, payment and health care operations, a covered entity that also offered financial services could be able to use protected health information without authorization to market or make coverage or rate decisions for its financial services products. Without the minimum necessary standard for uses, a hospital would not be constrained from allowing their appointment scheduling clerks free access to medical records.

We agree, however, that it is appropriate to apply somewhat different requirements to uses and disclosures of protected health information permitted by this rule. We therefore modify the application of the minimum necessary standard to accomplish this. See the preamble to § 164.514 for a discussion of these changes.

Comment: A commenter argued that the development, implementation, and use of integrated computer-based patient medical record systems, which requires efficient information sharing, will likely be impeded by regulatory restrictions on the "use" of protected health information and by the minimum necessary standard.

Response: We have modified the proposed approach to regulating "uses" of protected health information within an entity, and believe our policy is compatible with the development and implementation of computer-based medical record systems. In fact, we drew part of the revised policy on "minimum necessary" use of protected health information from the role-based access approach used in several computer-based records systems today. These policies are described further in§ 164.514.

Comment: One commenter asked that the general rules for uses and disclosures be amended to permit covered entities to disclose protected health information for purposes relating to property and casualty benefits. The commenter argued that the proposal could affect its ability to obtain protected health information from covered entities, thereby constricting the flow of medical information needed to administer property and casualty benefits, particularly in the workers' compensation context. It was stated that this could seriously impede property and casualty benefit providers' ability to conduct business in accordance with state law.

Response: We disagree that the rule should be expanded to permit all uses and disclosures that relate to property and casualty benefits. Such a broad provision is not in keeping with protecting the privacy of individuals. Although we generally lack the authority under HIPAA to regulate the practices of this industry, the final rule addresses when covered entities may disclose protected health information to property and casualty insures. We believe that the final rule permits property and casualty insurers to obtain the protected health information that they need to maintain their promises to their policyholders. For example, the rule permits a covered entity to use or disclose protected health information relating to an individual when authorized by the individual. Property and casualty insurers are free to obtain authorizations from individuals for release by covered entities of the health information that the insurers need to administer claims, and this rule does not affect their ability to condition payment on obtaining such an authorization from insured individuals. Property and casualty insurers providing payment on a third-party basis have an opportunity to obtain authorization from the individual and to condition payment on obtaining such authorization. The final rule also permits covered entities to make disclosures to obtain payment, whether from a health plan or from another person such as a property and casualty insurer. For example, where an automobile insurer is paying for medical benefits on a first-party basis, a health care provider may disclose protected health information to the insurer as part of a request for payment. We also include in the final rule a new provision that permits covered entities to use or disclose protected health information as authorized by workers' compensation or similar programs established by law addressing work-related injuries or illness. See § 164.512(l). These statutory programs establish channels of information sharing that are necessary to permit compensation of injured workers.

Comment: A few commenters suggested that the Department specify "prohibited" uses and disclosures rather than "permitted" uses and disclosures.

Response: We reject these commenters' because we believe that the best privacy protection in most instances is to require the individual's authorization for use or disclosure of information, and that the role of this rule is to specify those uses and disclosures for which the balance between the individuals' privacy interest and the public's interests dictates a different approach. The opposite approach would require us to anticipate the much larger set of all possible uses of information that do not implicate the public's interest, rather than to specify the public interests that merit regulatory protection.

Comment: A commenter recommended that the rule be revised to more strongly discourage the use of individually identifiable health information where de-identified information could be used.

Response: We agree that the use of de-identified information wherever possible is good privacy practice. We believe that by requiring covered entities to implement these privacy restrictions only with respect to individually identifiable health information, the final rule strongly encourages covered entities to use de-identified information as much as practicable.

Comment: One commenter recommended that when information from health records is provided to authorized external users, this information should be accompanied by a statement prohibiting use of the information for other than the stated purpose; prohibiting disclosure by the recipient to any other party without written authorization from the patient, or the patient's legal representative, unless such information is urgently needed for the patient's continuing care or otherwise required by law; and requiring destruction of the information after the stated need has been fulfilled.

Response: We agree that restricting other uses or re-disclosure of protected health information by a third party that may receive the information for treatment, payment, and health care operations purposes or other purposes permitted by rule would be ideal with regard to privacy protection. However, as described elsewhere in this preamble, once protected health information leaves a covered entity the Department no longer has jurisdiction under the statute to apply protections to the information. Since we would have no enforcement authority, the costs and burdens of requiring covered entities to produce and distribute such a statement to all recipients of protected heath information, including those with whom the covered entity has no on-going relationship, would outweigh any benefits to be gained from such a policy. Similarly, where protected health information is disclosed for routine treatment, payment and operations purposes, the sheer volume of these disclosures makes the burden of providing such a statement unacceptable. Appropriate protection for these disclosures requires law or regulation directly applicable to the recipient of the information, not further burden on the disclosing entity. Where, however, the recipient of protected health information is providing a service to or on behalf of the covered entity this balance changes. It is consistent with long-standing legal principles to hold the covered entity to a higher degree of responsibility for the actions of its agents and contractors. See § 164.504 for a discussion of the responsibilities of covered entities for the actions of their business associates with respect to protected health information.