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White House Issues Rules on Patient Privacy

Health care: Critics call standards lax, while the administration says they strike the right balance. Providers do not need consent to share records.


WASHINGTON — The Bush administration released final medical privacy regulations Friday that will require doctors, HMOs and hospitals to tell patients how they use their medical records.

But unlike privacy rules approved by the Clinton administration, the Bush rules do not require health-care providers to obtain patients' consent before sharing their medical records with insurance companies, drug manufacturers and pharmacies.

The Bush regulations also allow health-care providers, pharmacies and drug companies to profit from the use of patient records, giving them broad leeway to use medical information to market their health-care products.

When the 443-page rule, ordered by Congress six years ago, finally takes effect in April, it will for the first time provide all Americans with basic privacy protections for their medical records.

But privacy advocates argued that the rules fall woefully short of what is needed, and it was clear that the debate over patient consent, the use of medical records for marketing purposes and the effect of confidentiality on patient care would continue in Congress, state legislatures and political campaigns.

"The good news," said Janlori Goldman, director of Georgetown University's Health Privacy Project, who was highly critical of many of the regulations' specific provisions, "is that they did allow the rule to go into effect."

Bush administration officials said some sharing of medical information--when a doctor orders a prescription or refers a patient to a specialist, for example--is necessary, and the new rules strike just the right balance.

In providing basic privacy protections, Health and Human Services Secretary Tommy G. Thompson said the administration worked to avoid "creating greater hardships or more health-care bureaucracy for patients as they seek to get prompt and effective care."

The American Assn. of Health Plans, a trade group representing more than 1,000 HMOs, and the Federation of American Hospitals applauded the administration for issuing balanced, workable rules. The Health Insurance Assn. of America said the regulations were less onerous than the Clinton administration rules but would "inevitably increase the cost of health care."

But some of Congress' strongest defenders of patient privacy, comparing the new rules to the Clinton administration regulations they replace, said Americans had actually lost confidentiality protections.

Sen. Edward M. Kennedy (D-Mass.) called the Bush regulations a "serious setback for medical privacy." Referring to the intense lobbying by the health-care industry, he said they were "yet another example of the Bush administration favoring the interests of powerful corporations over those of ordinary Americans."

Rep. Henry A. Waxman (D-Los Angeles) said, "The Bush administration is going backwards in privacy protection by creating huge loopholes that will significantly undermine privacy for most Americans."

The American Psychiatric Assn., perhaps the strongest defender of patient confidentiality among health-care providers, expressed deep disappointment and said the regulations could actually lower the quality of health care.

With few guarantees on the privacy of their medical records, some patients "may simply decide not to come for certain kinds of care or they may withhold information that would be very important in treating their condition," said Dr. Paul Applebaum, president of the association.

Some patients, afraid that information about their medical condition could lead to the loss of a job or insurance, already hop from doctor to doctor, pay for medical bills out of pocket and refuse to seek care.

Under the Bush administration's rules, a physician or hospital can send a patient's medical information to an insurance company even if the patient paid the bill in cash to prevent that.

Such practice will "play havoc with patient confidentiality" and further erode the quality of care for some patients, said Richard Sobel, senior research associate at Harvard Medical School.

Some privacy experts found the marketing provisions of the new regulations the most troubling of all.

The new rules prohibit a doctor or pharmacy from selling patient names and health-care information to a third party--a drug company, for example. However, the rules allow the physician or pharmacy to accept payment from the drug company to send all their patients taking one drug for heartburn a letter recommending that they switch to one manufactured by the company paying for the solicitation.

In effect, Goldman said, "the administration is legalizing one of the more reprehensible practices: the selling of people's medical records."

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