Is HIPAA helping in any way?(Pro & Con)

YES

One of the positive things about the Health Insurance Portability and Accountability Act of 1996 (HIPAA) is that the statute outlines a set of minimum national requirements that people can follow. The statute makes it possible for vendors, the health care information technology industry, medical practices, hospitals, and health plans to understand some of the ground rules for the exchange of health information.

Previously, there were multiple interpretations for health privacy, multiple interpretations for health security and multiple interpretations of how to exchange information between doctors and health plans. Now there is a set of national standards in those areas.

HIPAA will make the health care industry more like the banking industry, in which electronic data interchange occurs for fractions of a penny per transaction. That is largely a result of those transactions being standardized. The federal government is now enforcing that kind of efficiency in the health care system.

In the short run, HIPAA may be significantly disruptive, but in the long run it should lead to very significant savings for all of the major players. But it's not always easy for physicians to see those savings, and it's hard for physicians to think in the long term because they're focused on the short-term problems they have with reimbursement.

Although HIPAA contains some helpful elements, one major problem is on the horizon--the Oct. 16 deadline by which all practices will have to have in place the new electronic data standards for the transmission and exchange of information with health plans, including Medicare. It is also the deadline after which Medicare will no longer accept paper claims.

Unfortunately, most physicians still seem to think that vendors and clearinghouses have taken care of the compliance issues, and many of them appear not to have. So the worry is that claim rejection rates for electronically submitted claims could increase significantly after Oct. 16.