The Importance of HIPAA Compliance for Medical Practices


The Health Insurance Portability and Accountability Act (HIPAA) was introduced in 1996. The goal of this landmark piece of legislation is to ensure that those in the healthcare industry meet the standards to become HIPAA-compliant. These standards include integrity, confidentiality and the ability to access all of a patient’s virtual healthcare records. HIPAA compliance benefits the healthcare industry, medical professionals and patients.

Why Is HIPAA Compliance So Important for a Medical Practice?

This legislation is designed to prevent healthcare fraud by safeguarding a patient’s sensitive information and providing a way for the patient to specify who is able to access and use his or her health information. Therefore, to ensure that patients have control over their personal health information, HIPAA compliance is essential. Simultaneously, HIPAA regulates disclosure of data for treatment purposes and public interest. For these reasons, if you transfer confidential information in any form (i.e., verbally, electronically, with documentation) both inside and outside your medical practice you need to become HIPAA-compliant.

When your medical practice complies with HIPAA regulations, besides protecting the patient’s information and ensuring his or her privacy, your practice receives protection from lawsuits and expenses related to data breaches. Furthermore, since HIPAA compliance is required, you will no longer be at risk for receiving violation penalties linked to noncompliance.

HIPAA's Rules

The Notice of Privacy Practices Rule

Under HIPAA’s Privacy Rule, you must provide your patients with a Notice of Privacy Practices. This notice explains when a patient’s Protected Health Information (PHI) can be disclosed. It also explains your patients’ rights, as well as how and why they may want to exercise them. In addition, your notice should inform them how they can request an accounting of medical records disclosure, as well as how to access their own medical records.

HIPAA's Data Breach Notification Rule

This rule specifies HIPAA’s requirements for providing notification following a data breach.

The HIPAA Security Rule

The Security Rule stipulates how sensitive data should be protected, rather than how the data should be used.

Do Small Medical Practices Need To Attain HIPAA Certification?

Yes, as a covered entity, small medical practices are required to attain HIPAA certification. In addition, with the incidence of cybersecurity threats on the rise, and the healthcare industry’s increase in the use of digital data, protecting sensitive information by following HIPAA’s regulations is more important than ever before. Especially when you consider that by following HIPAA’s rules and regulations, you can minimize vulnerabilities and reduce the effect that a data breach would have on your practice, should one occur.

HIPAA's covered entities:

  • Health care providers (e.g., clinics, hospitals, medical practices, nursing homes, physicians).
  • Healthcare clearinghouses (e.g., companies that process claims).
  • Health plans (e.g., government health programs, insurance companies).

In addition, HIPAA requires that any third-party vendor or organization providing services to a covered entity must also be HIPAA-compliant.

Some of these third-party vendors are:

  • Attorneys
  • Contractors
  • IT specialists
  • Accountants

Reasons Every Medical Practice Needs To Become HIPAA Compliant

Providers should respect their patients’ privacy. Medical professionals must recognize that patients share sensitive information with them. Information that they would prefer remain between themselves and their provider. When HIPAA is in place, patients know that their information remains private, which is why they typically feel comfortable being more honest and open with their provider.

HIPAA compliance is a law. Organizations and health care providers who fail to become HIPAA-compliant could face serious consequences (e.g., heavy fines and actions against their licenses).

HIPAA protects a provider who suspects that a patient is at risk for harming himself, herself or others. This protection is vital because it ensures that the provider is not penalized for protecting the patient and potential victims.

What Happens If a Medical Practice Neglects To Become HIPAA Compliant?

Complying with HIPAA’s Administrative Simplification provisions, and the provisions set forth by the Health Information Technology for Economic and Clinical Health (HITECH) Act of 2009 are frequently considered to be a burden on a medical practice’s administration. However, many health care providers find that this burden on their administration can be eased by employing practice management software with an electronic health records (EHR) solution from Amazing Charts. These solutions save you time, money, help to reduce medical errors and give you the ability to provide care more efficiently. In addition, once your practice attains HIPAA certification and becomes HIPAA-compliant, chances are, you will recognize the benefits associated with following these regulations. Especially when, according to the Procedures for Investigations, Imposition of Penalties, and Hearings – Interim Final Rule, you could receive substantial civil money penalties and actions against your license for noncompliance.

How Does HIPAA Compliance Benefit a Medical Practice?

Having access to all of a patient’s recent medical records provides physicians with a comprehensive view of the patient’s health, allowing doctors to make a better-informed diagnosis, which results in the patient receiving the best course of treatment. Better treatment means that patient outcomes improve, resulting in higher satisfaction scores from both patients and their family members. These scores are frequently used as an indicator for measuring the quality of health care a practice provides. High satisfaction scores and better outcomes for patients can increase staff morale throughout a practice.

Other benefits of becoming HIPAA-compliant:

  • Prevents you from being penalized for noncompliance.
  • HIPAA can help you streamline your practice’s administrative functions and protect you from legal actions due to a data breach.
  • HIPAA keeps your patients’ electronically protected health information (ePHI) secure by making sure that their information is stored, transmitted, shared and accessed through its own data system.
  • Since entities covered by HIPAA are required to use nationally recognized identifiers and specific code sets, becoming HIPAA-compliant helps reduce the likelihood of a miscommunication when transferring Protected Health Information between providers and health plans, as well as third-party vendors.
  • Although financial benefits are difficult to quantify, the decrease in miscommunication typically leads to fewer claim denials due to coding issues and quicker payment from insurance companies.
  • The increase in morale resulting from better patient outcomes can help reduce staff turnover, which translates into fewer costs related to finding, interviewing and training new staff members.
  • HIPAA standardizes electronic transactions. This standardization helps streamline billing, eligibility checks and payments. All of which decrease the amount of time your practice spends on completing paperwork.

How Trusting Health Care Providers Can Improve Patient Health

Once patients realize that their health information is protected, they frequently feel more confident about revealing some of the more personal details about their health. In this way, becoming HIPAA-compliant helps medical professionals build trust with their patients. Furthermore, studies indicate that a patient who trusts his or her medical professional may reduce participation in unhealthy activities and begin to implement healthier ones.

Other benefits include patients scheduling their preventative services, complying with the medications they receive and moving forward with the treatments they need, all of which can reduce the severity of a patient’s illness and accelerate his or her recovery.

Additional ways you can demonstrate a commitment to your patients’ confidentiality:

  • Offer advice on how they can use your patient portal safely and securely.
  • Protect sensitive information by securing your office’s Wi-Fi with a password.
  • Recommend healthcare apps that abide by the Xcertia guidelines.
  • Extend HIPAA-compliant measures outside your private office and exam rooms by providing partitioned waiting areas and having the ability to close the reception window whenever you are discussing PHI.

If you are ready to learn more about how you can benefit from implementing practice management software with EHR solutions from Amazing Charts, contact us today.