APA Presses for Medical Records Privacy Changes


Is consent necessary for medical records to be utilized for treatment, payment and health care operations? The medical records privacy rule demands it. Will prepayment and postpayment audits by insurance companies be cut back? The Medicare Education and Regulatory Fairness Act of 2001 is an attempt to solve this and other issues.

Washington Report

The American Psychiatric Association is pushing Tommy G. Thompson, the secretary of the U.S. Department of Health and Human Services, to make changes in the medical records privacy rule that went into effect on April 14. The rule was finalized by the Clinton administration last December, but the Bush administration had delayed putting the rule into effect for two months while it considered delaying the effective date beyond April 14 in order to allow time to make major changes. President Bush ultimately decided against another delay.

The health insurance industry has complained that the rule, as written, will increase its costs beyond any commensurate benefit to consumers. The rule requires physicians and other providers, such as insurance companies, to get prior consent from patients before using their identifiable medical data for treatment, payment and health care operations.

Daniel Borenstein, M.D., president of the APA, told the press, "President Bush's bold implementation decision clearly deserves our praise, for the regulation is a dynamic step toward protecting patient privacy, as it requires informed consent before an individual's medical record can be disclosed for treatment, payment or other health care operations."

Paul Appelbaum, M.D., vice president of the APA, told the U.S. House's Energy and Commerce Subcommittee on Health on March 22 that the APA wants Thompson to make numerous changes in the final rule. Even though the rule requires prior patient consent, the patient is obligated to give that blanket consent to the health plan when joining. So the patient never knows who receives their medical information, or when that information is released. The patient can revoke consent, but the health plan can cancel the patient as a result.

The final rule also gives health plans wide discretion to either use patient information or pass it on to third parties for solicitations on behalf of disease management programs. Appelbaum said that the APA opposes disclosure of health information for disease management activities without the coordination and cooperation of the individual's physician.

"We believe 'disease management' needs to be defined narrowly, in order to prevent inappropriate use and disclosure (for example for marketing purposes) of health information without the patient's consent," Applebaum explained.

Bill Would Ease Medicare Regulatory Burdens

Physician groups are strongly supporting legislation (S 452/HR 868) that would whittle down Medicare's use of audits. The Medicare Education and Regulatory Fairness Act of 2001 would force insurance companies to cut back on both prepayment and postpayment audits under certain conditions, and it would give physicians up to three years to pay back overpayments exceeding $5,000 that they received unwittingly. The bill's other provisions prohibit Medicare from enforcing interim rules and from applying new rules retroactively.

"Psychiatrists are floundering under Medicare's 100,000-plus pages of regulations," Daniel Borenstein, M.D., American Psychiatric Association's then-president, said in a March 8 press release. "Medicare's elderly and disabled beneficiaries have a substantial and growing need for psychiatric services, but HCFA's [Health Care Financing Administration] confusing payment rules and the all-too-adversarial attitude by Medicare bureaucrats are a huge impediment to APA members seeking to provide such care," he said.

Physicians are emboldened by the ascension of President Bush, who is often seen as more sympathetic to complaints regarding regulatory burdens than former-President Clinton. Even some Democrats, who in the past have been less-than-moved by physician complaints about Medicare, are now evincing some interest in the problem. At hearings held March 15 in the U.S. House's Ways and Means Subcommittee on Health, Democratic Rep. Pete Stark of California conceded, "There are some legitimate issues relating to provider regulation that need to be addressed." However, he continued, the Act was "over-reaching as introduced."

George Grob, Deputy Inspector General for Evaluation and Inspections at the Office of the Inspector General, was also partially sympathetic; however, he opposed many of the more substantial provisions in the bill. With regard to allowing physicians to repay overpayments over three years, he commented, "While repayment plans make sense in some cases, they could greatly reduce the ability of Medicare to recover overpayments in others."

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