Health Information Management

What are HIPAA's guidelines with regard to a hospital selling its accounts receivables?

HIPAA Weekly Advisor, January 22, 2007

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The hospital must strip all health-related information from the sold records; the records should include only financial and demographic information.

This can be a touchy subject and it is wise to enter into a contract with the collection agency that requires the agency to use the information only to collect a debt. It is also advisable to sell receivables only to a financial organization covered by the provisions of the Gramm-Leach-Bliley Act, which requires financial organizations to protect the privacy of the data sold by the hospital and to provide a notice of privacy practices annually.

A conflict with HIPAA could arise if, by selling the receivables, the hospital discloses the medical condition of the patient. For example, the receivables might list an alcohol and chemical dependency treatment facility or a psychiatric facility affiliated with the hospital as their owner. In these cases, it would be relatively easy to determine that the patient is being treated for alcohol/chemical dependence or mental illness.

In both examples, the hospital would inadvertently release health information that a reasonable person could use to identify the condition of the patient. This could lead to potential violations of HIPAA and other federal or state law.

Editor's note: Chris Apgar, president of Portland, OR-based Apgar & Associates, LLC, answered this question. This is not legal advice. Consult your attorney for legal matters.



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