Health Insurance Portability And Accountability Act - HIPAA

DEFINITION of 'Health Insurance Portability And Accountability Act - HIPAA'

An act created by the U.S Congress in 1996 that amends both the Employee Retirement Income Security Act (ERISA) and the Public Health Service Act (PHSA) in an effort to protect individuals covered by health insurance and to set standards for the storage and privacy of personal medical data.

BREAKING DOWN 'Health Insurance Portability And Accountability Act - HIPAA'

The HIPAA ensures that individual health care plans are accessible, portable, and renewable, and it sets the standards and the methods for how medical data is shared across the U.S. health system in order to prevent fraud. It pre-empts state law unless the state's regulations are more stringent.

This act has been modified since 1996 to include processes for safely storing and sharing patient medical information electronically. The act also has an administrative simplification provision, which is aimed at increasing efficiency and reducing administrative costs by establishing national standards.

Health insurers, health maintenance organizations (HMOs), healthcare billing services and other entities that handle sensitive personal medical information must comply with the standards set by the HIPAA. Noncompliance may result in civil or criminal penalties.

RELATED TERMS
  1. HIPAA Waiver of Authorization

    A legal document that allows an individual’s health information ...
  2. Portability

    An employee's ability or right to retain certain benefits when ...
  3. Medical Cost Ratio

    A comparison of a health insurance company's healthcare costs ...
  4. Medical Identity Theft

    Stealing another person’s health insurance information so that ...
  5. Health Insurance Marketplace

    Organizations that facilitate structured and competitive markets ...
  6. Medical Underwriting

    The process of assessing the risk associated with providing health ...
Related Articles
  1. Budgeting

    5 Alternatives to Traditional Health Insurance

    Discover five of the most popular alternatives to traditional health insurance plans, alternatives that are increasingly popular as health insurance costs rise.
  2. Why Health Insurance Premiums Will Rise in 2017

    To battle the costs and challenges of the Affordable Care Act, many health insurances are raising their premiums in 2017.
  3. Insurance

    Investing In Health Insurance Companies

    Health insurance companies work a little differently than most companies. Here's what you need to know as an investor.
  4. Insurance

    Do This If Health Insurance Doesn’t Cover Your Bills

    Health insurance doesn't pay enough to help the millions of consumers who are drowning in medical debt. Are there any other options to soften the blow?
  5. Insurance

    Do You Need Short-Term Health Insurance?

    Yes, if you've no other coverage options. Here’s what you need to know about how it works and how it differs from employer-provided and marketplace plans.
  6. Insurance

    Don’t Have Health Insurance? What’s the Worst That Could Happen?

    Healthcare is expensive, but those without healthcare coverage put themselves at risk.
  7. Insurance

    7 Mistakes to Avoid When Buying Health Insurance

    Understand the need for health insurance and why some undervalue the need for coverage. Learn about the top seven mistakes to avoid when purchasing insurance.
  8. Insurance

    Why Is Health Care So Expensive In The Us?

    The U.S. is the world leader in only one area of health care: costs. Why is it so hard to rein in these expenses?
  9. Retirement

    Is Your Health Insurance Enough For Retirement?

    Learn what to expect to pay for health insurance in retirement, what is covered through Medicare and what the Affordable Care Act means for retirees.
  10. Insurance

    Yes, You Can Still Expect Health Insurance at Work

    A recent report from The New York Times says that health plans offered by employers are here to stay, despite the passage of the Affordable Care Act.
RELATED FAQS
  1. In what ways does government regulation impact the insurance sector?

    See how government regulation of the insurance sector leads to higher prices, more risk and a system where the consumer has ... Read Answer >>
  2. What role does the agency problem play in the modern Health Care industry?

    Read about the role of the principal-agent problem in the modern American health care industry, and learn why health insurance ... Read Answer >>
  3. Is a Simplified Employee Pension (SEP) part of the Employee Retirement Income Security ...

    Understand when a SEP plan falls under ERISA, how this act protects individual retirement savings and why the SEP is a popular ... Read Answer >>
  4. What is the average annual dividend yield of companies in the chemicals sector?

    Discover how operations management theory is applied across a broad spectrum of operational and management issues in the ... Read Answer >>
  5. What are some examples of industries that practice price discrimination?

    Understand the various types of insurance coverage offered in the insurance marketplace, and learn why each policy should ... Read Answer >>
  6. What are catch-up contributions for Health Savings Accounts (HSAs)?

    Learn about Health Savings Accounts (HSAs) and how an eligible individual of age 55 or older can make additional catch-up ... Read Answer >>
Hot Definitions
  1. Reverse Mortgage

    A type of mortgage in which a homeowner can borrow money against the value of his or her home. No repayment of the mortgage ...
  2. Labor Market

    The labor market refers to the supply and demand for labor, in which employees provide the supply and employers the demand. ...
  3. Demand Curve

    The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity ...
  4. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  5. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
  6. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
Trading Center