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Who does HIPAA apply to?

HIPAA applies to who?

HIPAA, formally known as the Health Insurance Portability and Accountability act, was signed into legislation back in the 90's. These regulations were enacted as a multi-tiered approach that set out to improve the health insurance system. The HIPAA rules are mandatory for all covered entities and business associates. What does that mean?

  • A covered entity is classified as any healthcare provider, health plan or healthcare clearinghouse.

  • Each and every individual, organization and agency that is classified as a covered entity must be in complete compliance to protect health information and allow individuals right their data.

  • If these covered entities engage with business associates, those business associates must enter into a legal binding agreement that clearly establishes the responsibilities of both parties.

Why does HIPAA matter? Well, all healthcare entities and organizations that use, store, maintain or transmit patient health information are expected to be in complete compliance with the regulations of the HIPAA law. When completely adhered to, HIPAA regulations not only ensure privacy, reduce fraudulent activity and improve data systems but are estimated to save providers billions of dollars annually. By knowing of and preventing security risks that could result in major compliance costs, organizations are able to focus on growing their profits instead of fearing these potential audit fines.

HIPAA legislation is ever-evolving and although it may seem complicated and tedious, it is imperative that everyone is in compliance. HIPAA has many parts to it, including many rules like the HIPAA Privacy Rule and HIPAA Security Rule. Just as one must be aware of every minute part of these HIPAA directives, one must be prepared for change. With Healthcare Reform and other disruptive movements, the industry is in need of flexibility. Keep an open mind when tackling healthcare because nothing is set in stone, nor will it ever be.

Despite the complexity of our healthcare system, everyone can make an impact. By being an educated healthcare consumer, the industry is one step closer to moving from a volume-based care model to one that is purely value-based. It is time to understand healthcare, analyze behaviors and determine solutions. Why now? Because there's no better time than now.

For more information on HIPAA, check out the Datica Blog. Additional questions? Contact one of our experts today.

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