What is HIPAA used for?

Most of us already know the basic of HIPAA and what the acronym is which is; Health Insurance Portability and Accountability Act and it was passed by Congress in 1996. Now we can move onto the real question which is, what is HIPAA used for?

  • Provides the ability to transfer and continue health insurance coverage for millions of American workers and their families when they change or lose their jobs;
  • Reduces health care fraud and abuse;
  • Mandates industry-wide standards for health care information on electronic billing and other processes; and
  • Requires the protection and confidential handling of protected health information

HIPAA is organized into separate “Titles.”  For information on the HIPAA Titles read below

Title I: Heath Care Access, Portability and Renewability

HIPAA Title I of the Health Insurance Portability and Accountability Act of 1996 protects health insurance coverage for workers and their families when they change or lose their jobs.

It places restrictions on how previous conditions are handled and reduces the amount of time new members have had to have “credible coverage” before joining the plan. Essentially, Title I is concerned with insurance reform for employer-provided healthcare plans.

Title II: Preventing Health Care Fraud and Abuse; Administrative Simplification; Medical Liability Reform

This is the most well-known part of HIPAA, as it concerns patient privacy and data protection. This part of HIPAA also contains the Privacy, Security, Enforcement, Breach Notification and Omnibus Rules. Each of these have been added to HIPAA since it was signed into law in 1996 and concerns a different part of data protection.

This part of HIPAA defines protected health information (PHI) and details the rules for its disclosure. It also lays out the minimum safeguards (administrative, physical and technical) that must be enacted to protect the PHI from unauthorized access.

However, for HIPAA to have a meaningful effect, there must be punishments for non-compliance. The Enforcement Rule introduced the penalties for non-compliance with the rules, which can be financial or criminal. These penalties act as a deterrent, further protecting patient privacy.

Title III: Tax-related health provisions governing medical savings accounts

Title III relates to how much money can be saved for certain tax deductions for medical insurance, and makes other changes to health insurance law.

Title IV: Application and enforcement of group health insurance requirements

This details how group health insurance plans deal with members specifies conditions for group health plans regarding coverage of persons with pre-existing conditions, and modifies continuation of coverage requirements.

Title V: Revenue offset governing tax deductions for employees

This includes provisions related to company-owned life insurance, treatment of individuals who lose U.S. Citizenship for income tax purposes and repeals the financial institution rule to interest allocation rules.

What is the most important part of HIPAA?

Each part of HIPAA is different. However, the most relevant part of HIPAA for most people will be Title II, which is what most people refer to when they talk about HIPAA or what the purpose of the legislation is. From this Title, we can see that the purpose of HIPAA is to protect patients from data breaches, maintaining their privacy and preventing them from becoming the victims of fraud. This is what is most commonly meant when people talk about HIPAA compliance and violations of the rules under this Title result in prosecution by the OCR. HIPAA also has another important purpose and that is to ensure long term access to PHI.


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Patrick Domingues

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