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U.S. Health Insurance Portability and Accountability Act of 1996

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HIPAA was signed into law in 1996, while the HIPAA Privacy Rule and Security Rule each went into effect in 2003. Organizations that must comply with HIPAA requirements are known as covered entities and fit into three categories:

 Health plans: This includes health insurance companies, government programs like Medicare, and military and veteran's health programs that pay for healthcare.

 Healthcare providers: This includes hospitals, doctors, nursing homes, pharmacies, and other medical providers that transmit health information.

 Healthcare clearinghouses: This includes public and private organizations, like billing services, that process or facilitate the processing of nonstandard health information and convert it into standard data types. A healthcare clearinghouse is usually the intermediary between a healthcare provider and a health plan or payer of health services.

The HIPAA Privacy Rule establishes minimum standards for protecting a patient's privacy and regulates the use and disclosure of individuals' health information, referred to as protected health information. Under HIPAA, an individual's PHI is permitted to be used strictly for the purposes of performing and billing for healthcare services and must be protected against improper disclosure or use.

The HIPAA Security Rule establishes minimum standards for protecting PHI that is stored or transferred in electronic form. The Security Rule operationalizes the Privacy Rule by establishing the technical, physical, and administrative controls that covered entities must put in place to protect the confidentiality, integrity, and availability of electronically stored PHI (or e-PHI).

Civil penalties for HIPAA violation may include fines that range from $100 to $50,000 per violation, with a maximum penalty of $1.5 million per year for similar violations. Criminal penalties include fines up to $250,000 and potential imprisonment up to 10 years.

The Official (ISC)2 CISSP CBK Reference

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