DGS Health Law Blog : Denver Health Care Lawyers & Attorneys : Davis Graham & Stubbs Law Firm : HIPAA & Patient Privacy : Colorado, Rocky Mountain West

The Federal Trade Commission (FTC) issued a press release on July 29, 2009, announcing another three-month delay in its enforcement of the Red Flags Rule. The enforcement date, which had been scheduled for August 1, 2009, will now be postponed until November 1, 2009.

The Red Flags Rule is an anti-fraud regulation, aimed at reducing identity theft by requiring "creditors" to develop programs to identify, detect and respond to "red flags," that might indicate an act of identity theft.  (You can learn more specifics about the Red Flags Rule in a prior DGS post.)

This delay was issued in response to the House Appropriations Committee’s recent request that the FTC defer enforcement in order to minimize the impact of the Rule on health care providers and other small businesses.

In its press release, the FTC publicized that it will increase its efforts to educate small businesses about compliance requirements and that it intends to provide additional materials and guidance to do so. A specific link for small and low-risk entities will be set up on the FTC’s Red Flags Rule website to enable these entities to easily access materials that are relevant to their compliance needs. 

The FTC already offers a Red Flags Rule FAQs section, which addresses many compliance and enforcement issues.

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The EECO recently issued guidance on employees' concerns about waiving and releasing possible claims against their employers as part of a settlement agreement that grants them severance pay upon termination of their employment.   While there is nothing in this document that will be surprising to a human resources director, it provides insight as to how the EEOC analyzes the issues in deciding whether or not a waiver should be applied to a discrimination claim filed post-termination.  It's worth a read and keeping on file if you may potentially be involved in terminating an employee's employment.

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On July 14, House Democrats unveiled a comprehensive health care reform bill, referred to as America's Affordable Health Choices Act of 2009, a 1000+ page document that radically changes the way Americans obtain health insurance and the current approaches for reimbursement to providers, as well as adding new taxes to help fund the program.  The 10-year cost to implement this bill has been estimated at over $1Trillion.  The draft bill will now go to three House Committees for review and mark-ups.  A summary and discussion of the draft bill's major provisions has been posted.  The Energy and Commerce Committee, chaired by Rep. Waxman, is also posting regular updates on its mark-up activities.

On the 15th, the Senate Health, Education, Labor and Pensions (HELP) Committee released its version of the Affordable Health Choices Act, only 650 pages, with its summary of the key provisions.  While somewhat shorter than the House draft, it also is a comprehensive overhaul of all aspects of the present health care payment and delivery system.  The Senate Finance Committee, chaired by Senator Baucus, is expected to release its proposed bill within a few days. 

Opposition to the various bills began to be expressed immediately from all across the political spectrum, and from members of both parties.  The most widespread concerns focus on the costs of the reforms and the government control over all aspects of health care.  It looks doubtful for any serious developments occurring by the August recess of Congress as had been sought by the President.

It's going to be an interesting Summer.

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Davis Graham & Stubbs originally compiled this summary of Colorado fraud & abuse statutes and regulations for the American Health Lawyers Association (AHLA).  These state laws generally compliment and enhance the federal Stark and Anti-Kickback statutes. 

With the Obama administration's increased efforts to combat health care fraud, it's important for all healthcare providers to be apprised of what the fraud and abuse laws prohibit, as well as the legal exceptions to these laws.

(The summary is reprinted with permission from the AHLA.  Copyright 2009 American Health Lawyers Association, Washington, D.C.) 

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ENFORCEMENT BEGINS AUGUST 1ST.

On August 1, 2009, the Federal Trade Commission (“FTC”) will begin enforcement of its "Red Flags" Rule, which is aimed at reducing identity theft.  The Rule requires creditors to look for "red flags" that signal possible identity theft, and applies to any “creditor” that maintains “covered accounts.” 

While most healthcare providers wouldn't usually think of themselves as traditional creditors, the Rule's definitions are broad enough to bring them into that realm.

Under the Rule, creditor is defined as any person or organization that “regularly extends, renews, or continues credit.” 

• When a healthcare provider allows a patient to pay for medical services after they are rendered or accepts payments over a period of time, that provider is acting as a creditor. 

Covered accounts include:

1. Accounts maintained by a creditor which are primarily for personal, family, or household purposes and are designed to permit multiple payments or transactions, or
2. Any other account for which there is a “reasonably foreseeable risk to consumers” of identity theft.

• Patient accounts likely fit within both of these categories.

Given the above, most healthcare providers will indeed need to comply with the "Red Flags" Rule.

View this "Red Flags" Rule PowerPoint presentation for a quick overview of the Rule's requirements and the consequences of noncompliance.

You can also consult the FTC's simplified "How-To Guide" , which provides the basics for complying with the Red Flags Rule.

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The American Recovery and Reinvestment Act of 2009 (commonly called the "Stimulus Bill") contains sweeping changes to HIPAA.  HIPAA has been expanded to reach entities not previously governed by HIPAA, and the penalties for violating HIPAA have increased dramatically.  The devil is in the details, however, and those details remain unknown until the implementing regulations are issued.  For a more detailed summary of the Stimulus Bill's changes to HIPAA, please see our DGS client alert on this issue.  

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