Health Information Management

Lawsuit: Red Flags Rule violates doctor/patient relationship

HIM-HIPAA Insider, May 31, 2010

By Cheryl Clark, HealthLeaders Media

On May 21, medical and osteopathic associations sued the Federal Trade Commission (FTC) for covering them under the Red Flags Rule, which requires them to start verifying their patients’ true identities before they agree to treat them. Enforcement of the rule begins June 1.

The lawsuit seeks to prevent the FTC from defining physicians as “creditors” whenever they do not require payment in full at the time they provide care, and later bill patients, according to the brief filed by the American Medical Association, the American Osteopathic Association, and the Medical Society of the District of Columbia. The organizations filed the suit in U.S. District Court in the District of Columbia.

“Creditors,” as defined by the FTC, must comply with the rule by implementing an identity theft prevention program that detects “red flags” for potential medical identity theft.

Meanwhile, the Senate filed a bill May 25, an awfully similar bill from the House’s in October that essentially exempts providers with fewer than 20 employees from complying with the FTC’s Red Flags Rule.

Read the full story on HIPAA Update.

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