Components of HIPAA

HIPAA, or the Health Insurance Portability and Accountability Act, passed into law in 1996 under the Clinton administration. Initially created to ensure that individuals maintained insurance to cover the period when changing jobs, the law later expanded to cover additional issues. The expansion eventually created five different components of the law, called "Titles." The additional rules affect health insurance plans and health care providers like doctors and hospitals, and also created penalties for non-compliance.

Title I

• Title I, the "Health Care Access, Portability and Renewability" component, creates protection for individuals with a preexisting condition, or a disease or illness that already exists, to continue health care coverage when changing employment or purchasing new insurance. "Portability," or the ability to continue health care coverage amidst these changes, is the main focus point of Title I.

Title II

• "Preventing Health Care Fraud and Abuse; Administration Simplification; Medical Liability Reform," or Title II, overviews how health care providers interact with insurance companies. This Title includes improving the standards of Medicare, setting policies to prevent fraud and abuse in health care, and establishing standards for the electronic transmission of patient health information. The "Administrative Simplification" portion of Title II is the most widely-discussed portion of HIPAA, especially for health care providers. This portion addresses the privacy and security of "protected health information." Separate components within the Title make up "The Privacy Rule" and "The Security Rule." The Privacy Rule covers appropriate release of patient health information, when authorization is necessary, and explains the requirements of privacy policies and procedures. The Security Rule portion covers protection for electronic patient health information, or e-PHI, from breach or unauthorized disclosure.

Title III

• The way in which employers handle medical savings accounts, including long-term care insurance and organ and tissue donation income tax refunds, make up HIPAA's Title III called "Tax-Related Health Provisions." Medical savings accounts are tax-deferred savings accounts used only for medical expenses.

Title IV

• HIPAA's Title IV, also known as "Application and Enforcement of Group Health Plan Requirements," addresses the Consolidated Omnibus Budget Reconciliation Act, or COBRA. This Title amends COBRA's 1985 Act to include language for group health plans and how they must allow individuals to carry health insurance into a new job, and allow for the same access and renewability as at previous jobs.

Title V

• Title V, also called "Revenue Offsets," explains federal code changes that generate more revenue to offset the additional costs caused by HIPAA implementation. This Title also includes tax-deduction mandates for company-owned life insurance premiums.