What Is the Purpose of HIPAA?

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The purpose of HIPAA, the Health Insurance Portability and Accountability Act, is to protect the medical records of individuals who have their records stored in or transferred between hospitals. Learn about the origin of HIPAA with information from a representative in this free video on insurance.

Part of the Video Series: Health Insurance Information
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Video Transcript

This is John Pinelli, financial representative, talking to you today about what is the purpose of HIPAA? HIPAA, the Health Insurance Portability and Accountability Act, was designed to protect the medical records of individuals who have their records stored, transferred in a hospital. Now, the reason for this is hospitals nowadays have quickly brought in the electronic transfer of data and electronic storage. Now, one of the downsides to this is the potential for hackers to get into the system; obtain these records, and use these records for things like identity theft which is the fastest growing crime in America. So, that that that is one reason for the Health Insurance Portability and Accountability Act is to make sure that these hospitals are properly storing the data so that they cannot get into the wrong hands of these identity thiefs and hackers which could potentially use the medical information to harm the individuals. So, HIPAA will closely regulate the hospitals. Oftentimes, in HIPAA compliance the hospitals are required to conform to certain steps, certain procedures for transferring the data, for storing the data, labeling the data, etc., so that the data cannot be intercepted or stolen. Now, the hospital has a responsibility to comply with HIPAA; not only for their patients whose records they're storing, but also for themselves, because potentially, failing to comply with HIPAA could result in major fines, or even imprisonment for whoever is responsible for the the infraction. So, this has been John Pinelli, financial representative, talking to you today about the purposes of HIPAA.

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