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Washington Beat


M.E. WASH0618


Washington Beat

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Choose article section...Regulation: Protection of medical records can't come too late—or too soon—for many providers Watchdogs: Where's the least risky place to practice? Idaho, maybe The White House: 6 million fewer uninsured? Bush & Co. say it's doable Medicare: Surprise! Spending for seniors' health care to increase Federal outlays for Medicare Quotables: Where does the money go?

By Michael Pretzer, Washington Editor

Regulation: Protection of medical records can't come too late—or too soon—for many providers

First, physicians, hospitals, managed care organizations, and others involved in health care wanted the Bush administration to postpone the effective date of the privacy regulations promulgated during the waning days of the Clinton administration. Take the time to get them right, was the nearly unanimous cry.

But George W. Bush surprised just about everyone in Washington when he announced that the regs would go into effect as planned two years hence. "We're disappointed that the administration didn't delay the effective date," says William F. Jessee, president and CEO of the Medical Group Management Association. "It would have been prudent in light of the more than 20,000 comments HHS received and the significant concerns raised by various parties."

Now everyone is urging the administration to hurry up. "It's imperative that changes are provided as expeditiously as possible," says Donald J. Palmisano, an AMA trustee. "Physicians need the full two-year compliance period to modify their practices."

"Practices also want to avoid allocating significant resources to comply with requirements that are later removed or altered," says Jessee.

So what's the problem? If, as HHS Secretary Tommy G. Thompson says, Washington has been debating patient privacy for the better part of a decade, surely all the glitches have been taken care of by now, haven't they?

Well, maybe not.

The AMA, one of many to critique the regs this spring, sent Thompson a 31-page letter detailing six "overarching concerns":

• Medical information may be disclosed without patient consent for reasons unrelated to the patient's treatment or payment for services. For example, a health plan doesn't have to get permission to use a patient's records in a disease management program. There's nothing wrong with disease management per se, explains the AMA, so long as it involves the treating physician. Unfortunately, the regs don't include that qualification.

Another example is the generous access afforded law enforcement agencies. The AMA says the regs ought to be more restrictive; officers of the law shouldn't be able to see medical records without a court order.

• Some organizations that have access to confidential medical records, such as employers and life insurance companies, aren't held directly accountable for treatment of the data. To a certain extent, Congress is to blame for this. The Health Insurance Portability and Accountability Act (HIPAA), which led to the creation of the regs, makes the rules applicable only to health care providers, health plans, and health-data clearinghouses. "Patient privacy will not be fully protected until Congress passes legislation that extends privacy requirements to all entities," says Palmisano.

• Under certain circumstances, physicians may be held liable for privacy violations committed by their "business associates," even when the doctors themselves have done nothing wrong.

• In some instances, health care organizations will be allowed to use confidential medical information—no consent needed—for marketing purposes. For instance, an organization could send sales reps to the homes of patients.

• The regs make a mockery of HIPAA, whose purpose was to cut costs by simplifying the business of health care.

• Complying with the regs will be extraordinarily expensive—even more expensive than the government predicts, asserts the AMA. Small group and solo practices will be hit the hardest. "Ironically, the [regs] substantially increase the administrative burdens for physicians—the one sector of the health care system already ethically bound to safeguard patient privacy," says Palmisano.

Reading the AMA's assessment of the regs, one can't help but conclude that physicians are going to pay for the sins of others. The privacy rules put "physicians and other health care professionals in the same category as large institutional providers, health plans, and clearinghouses," explains E. Ratcliffe Anderson Jr., the AMA's executive vice president and CEO. "Yet none of the fear expressed by patients with regard to potential misuse of their medical information is directed toward physicians."

The AMA and numerous other critics still have reason to think the regs will be revised. HHS' Thompson hasn't said his department will make big changes, but he's promised "modifications" and "guidelines to clarify some of the confusion." He's also asserted that "patient care will be delivered in a timely and efficient manner and not unduly hampered by the confusing requirements surrounding consent forms. Doctors will be able to consult with other physicians and specialists regarding a patient's care. Pharmacists will be able to fill prescriptions over the phone."

Watchdogs: Where's the least risky place to practice? Idaho, maybe

Washington-based Public Citizen's Health Research Group has completed its annual nationwide analysis of disciplinary actions taken against doctors. If you're the paranoid type, Idaho is the place for you—or so it would seem.

According to Public Citizen, Idaho's medical licensing board registered only 0.85 serious state medical licensing board disciplinary action for every 1,000 physicians in 2000. That's the lowest rate in the nation. Idaho was followed by South Dakota (1.24 actions per 1,000 doctors), Hawaii (1.33), Delaware (1.39), and Minnesota (1.53).

Adjacent to the state with the second-lowest disciplinary rate is the one with the nation's highest. Last year, North Dakota's licensing board took 12.43 serious license actions per 1,000 physicians. ("Serious" actions include revocations, surrenders, suspensions and probations/restrictions.) Behind North Dakota were Alaska (11.47), Kentucky (8.51), Wyoming (8.1), and Oklahoma (6.68).

Public Citizen's index, however, should be regarded with some skepticism. Two years ago, Idaho had the fourth-highest disciplinary rate. Dropping from fourth to 50th in 12 months doesn't make much sense. Idaho's numbers seem more like a statistical anomaly than an accurate description of its licensing board's work.

Maryland physicians, too, insist that the index gives a misleading portrait of doctor discipline in their state, which ranked 40th last year (2.21 actions per 1,000 physicians). Public Citizen's calculations are based on the number of licensed physicians in a state. That puts Maryland too low on the index, T. Michael Preston, the executive director of MedChi, the Maryland state medical society, recently explained to The Washington Post. Many doctors become licensed while training at one of the state's three medical schools, but then they scoot to other states to practice. If Public Citizen used the number of practicing physicians instead of the number of licensed physicians, Maryland would rank 12th.

Finally, Public Citizen makes a dubious assumption about its index. The organization figures that licensing boards in high-ranking states are doing a good job of policing doctors and that boards in states such as Idaho are doing a lousy job. But is that a reasonable conclusion? If the number of people arrested in a neighborhood is low, do you automatically think the cops there are lazy? Or do you say to yourself, hey, this might be a good place to live?

The White House: 6 million fewer uninsured? Bush & Co. say it's doable

This year in Congress, everyone and his uncle have introduced bills to give citizens without health insurance some sort of tax credit. Millions of poor folks, bolstered by a tax credit that may be as small as a few hundred bucks or as big as a couple of thousand, will phone a local agent and get themselves some insurance. Or so the thinking goes on Capitol Hill (see "Can the taxman deliver health care to the uninsured?" Washington Beat, May 21, 2001).

Not to be outdone, the Bush administration has come forward with its tax-credit proposal. Put its plan into play, promises the administration, and 6 million people—about 14 percent of the uninsured—will be calling their insurance agent.

Under the Bush plan, an individual earning $15,000 or less annually would be eligible for a $1,000 tax credit, and a family with yearly income of $30,000 or less could get a $2,000 credit. Individuals earning up to $30,000 annually and families earning up to $60,000 would be eligible for lesser credits calculated on a sliding scale.

The nifty thing about Bush's plan is that buyers don't have to front the money. That is, there'll be no need to buy insurance, then wait for tax-filing time to get a refund. Fill out the proper papers, and the IRS will pay the health insurance company directly. The not-so-nifty thing is that the tax credit is probably too small. Even with the credit, a person making $15,000 would have to come up with another thousand or two—just for basic coverage.

Medicare: Surprise! Spending for seniors' health care to increase

The forecasters at the Office of Management and Budget may not have the numbers exactly right. What's a few billion dollars more or less? But they've certainly got the direction figured out.

From 2002 to 2006, federal spending for Medicare benefits will go northward by an average of 5.4 percent annually, from $226 billion to $279 billion. Part A expenditures will rise 5.3 percent a year ($140 billion to $172 billion); Part B expenditures are to increase by 5.7 percent a year ($85 billion to $106 billion).

In 1966, the year after Medicare was created, the government spent only $64 million for the program. In 1967, the amount increased by more than 2.6 billion. Ever since, spending has continued to climb.

Federal outlays for Medicare


Quotables: Where does the money go?

"The Medicare, Medicaid, and Social Security programs spend millions of dollars a year on benefits to ineligible people, such as prisoners, fugitives, the deceased, deportees, and others. The exact dollar amount is difficult to determine, but a Committee on Finance investigation estimates that as much as $831 million is wasted through just 12 benefit programs at the Department of Health and Human Services and the Social Security Administration."

—Sen. Chuck Grassley (R-IA), announcing a hearing on the programs' improper payments.


Michael Pretzer. Washington Beat. Medical Economics 2001;12:20.

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