HIPAA: The Health Insurance Portability and Accountability Act Legislation

T he Health Insurance Portability and Accountability Act (HIPAA) of 1996 has had the greatest impact on health insurance and health insurance regulation since the implementation of Medicare and Medicaid in 1965 (Atchinson & Fox, 1997). However, the consequences of HIPAA’s full implementation are yet to be known. Recently, this law has received renewed attention and a place in the political spotlight, as the impact of the regulations for electronic transfer of patient information and privacy have become more fully understood and as health care industry officials wrestle with the changes and expected increased costs of compliance. This is occurring in the context of a health care industry that has already invested substantially in implementing and redesigning systems to accommodate the increased use of electronic transmissions of information to conduct business with patients, payers, and providers. HIPAA is often referred to as the KassenbaumKennedy Act. Senator Nancy Kassenbaum (R-KS) and Senator Edward Kennedy (D-MA) were original sponsors of the bill. HIPAA legislation was enacted in 1996 in response to national concerns for the need for health care insurance reform and