Economic Update

Health Care Law Changes Could
Boost Lawyers' Biz

By Stuart Markus
Long Island Business News
December 14, 2001

Several key provisions of the Health Insurance Portability and Accountability Act will come into effect in 2002 and are likely to generate businesses for lawyers who specialize in health law.

The act, first proposed by the Clinton administration in 1998 and 1999, covers the insurance industry, health care providers of all sizes and the vendors and contractors who serve them.

By October, any insurance carrier or administrator company that processes paperwork electronically must have its forms in a format specified under HIPAA. "Right now, every payer has his own format," according to Judith Eisen, a partner with Great Neck-based Garfunkle, Wild & Travis, the state's largest health care law firm. She said the different formats are sending the costs of administrative overhead for hospitals and doctors' offices up astronomically. Information fields and code sets must comply with a rubric mandated by the act.

Last week, the U.S. House of Representatives passed a bill allowing for an extension of up to one year, but only when a company can explain why it can't meet the deadline and how it plans to come into compliance. That explanation would need a work plan and a budget.

A Senate version of the bill has already passed, though there are significant differences between the two. "If you don't comply with this, you could potentially be kicked out of Medicare," Eisen said.

HIPAA's privacy regulations, which Secretary of Health and Human Services Tommy Thompson in April announced the Bush administration would let stand, surprising some, would require compliance by April 2003. Those provisions govern the use and disclosure of patients' specific health care information, limiting them to individuals essentially on a need-to-know basis. The regulations will require new protocols for how patient records are handled and who has access to them.

Not only will those laws apply to doctors, nurses, aides and administrators, they will apply to vendors and contractors who sell or serve the offices and hospitals; health care providers will be required to develop confidentiality agreements for them to sign. "It's one of the most pervasive laws we've seen in some time," Eisen said.

Roni Glaser, an attorney with Meltzer, Lippe, Goldstein and Schlissel's health care division, said the issue of privacy compliance has been the hottest. "We already have been (busy) - we're starting to gear up, as are our clients. It's getting the attention of a lot of people."

The insurance portability portion of the act, intended to ease the continuance of insurance benefits when an employee switches jobs by assigning them an identifying number - similar to a Social Security number - is still being formulated, Eisen said, with concern over privacy again an issue.

Standards for electronic transactions and code sets, governing the security of electronic transmissions of information - i.e. sending patient records and financial information via the Internet or an Intranet - are also still in the works, Glaser and Eisen said.