Health Care Exempt from the Red Flags Rule
The Senate passed bill (S. 3987) on November 30, 2010 that would exempt health care providers from the Red Flags Rule mandated by the Federal Trade Commission (FTC). On December 7, 2010 the House of Representatives approved the bill and it has been sent to the President for signature.
Because of the growing threat of Identity theft, the FTC wanted health care providers included in the rule. The FTC has been quoted in stating that over 5% of identity theft victims have experienced medical identity theft.
The Red Flags Rule was to go into effect in health care June 1, 2010 but was delayed because the American Bar Association as well as the National Association for Home Care and Hospice (NAHC) sued the FTC. These organizations believed the intent of the rule was good but it would have caused significant financial burdens to be incurred as a result of the rule. Health care organizations do not have the same risk of identity theft as financial accounts from other industries might incur.
According to members of Congress, the Rule does not require any specific procedure to be used for Identity Theft protection. Agencies with higher risk should have more robust measures to protect sensitive information. The new Rule does clarify which business must comply with the Rule. The bill, expected to be signed by President Obama, would exempt health care providers.
Tags: CMS, Home Care, Home Health, Legislation, Medicare