Appeals Court Upholds HIPAA

April 29, 2003 (PLANSPONSOR.com) - A federal appeals court has upheld the constitutionality of a new federal information privacy law in a South Carolina case - one of a series of similar legal challenges.

>The 4 th Circuit Court of Appeals ruled that Congress didn’t improperly give away its legislative authority when it charged the US Department of Health and Human Services (HHS) with issuing privacy regulations under the Health Insurance Portability and Accountability Act of 1996 (HIPAA), according to Washington-based legal publisher BNA.

>The case is South Carolina Medical Ass’n v. Thompson, 4th Cir., No. 02-2001, 4/25/03. The opinion is at  http://pacer.ca4.uscourts.gov/opinion.pdf/022001.P.pdf .

>The appeals judges upheld an August 2002 ruling from the US District Court for the District of South Carolina, which likewise affirmed HIPAA’s constitutionality. The 4th Circuit looked to whether Congress had enunciated an intelligible principle in HIPAA, considering whether Congress had clearly delineated “the general policy, the public agency which is to apply it, and the boundaries of this delegated authority.” Appeals judges, agreeing with the trial court, concluded it had.

>The appeals court found HIPAA provided “a clear mandate from Congress directing HHS to act in accordance with the intelligible principles set forth in HIPAA. Further, there are clear limits upon the scope of that authority and the type of entities whose actions are to be regulated.” 

>Appeals judges also upheld the HHS privacy regulations that had been challenged by South Carolina doctors and physicians’ groups, saying that the rules were consistent with HIPAA’s legislative intent and were not too vague to be valid. The South Carolina medical groups and physicians claimed that Congress had delegated too much authority to HHS and that the rules issued in December 2000 went too far in attempting to regulate all forms of speech involving individually identifiable health information, not just the electronic transfers governed by HIPAA.

Under HIPAA, patients will have the power to approve the release of their medical information to employers and life insurers, but they will have no say when it comes to releasing the information to health plans or billing companies. Under the rule, medical information can also be disclosed if the patient was unconscious or could not be identified in a hospital, and for other cases such as some public-health activities, and organ and tissue donation. HHS also has access to the records.

More Challenges

The South Carolina case is one of several legal challenges to the privacy law:

  • Patient advocacy groups, physicians organizations, and other medical professionals filed a challenge to the rules April 10, claiming they eliminate, rather than safeguard, privacy rights ( Citizens for Health v. Thompson,  E.D. Pa., No. 2:03-CV-2264) (See  Privacy Groups Try to Block HIPAA Disclosures  ).
  • An appeal of a June 2002 decision by a federal court in Texas asked the 5 th  US Court of Appeals to revive a challenge to the rule brought by the Association of American Physicians and Surgeons ( Association of American Physicians and Surgeons v. HHS, 5th Cir., No. 02-20792). Oral arguments in the Fifth Circuit are scheduled for the week of May 5.

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