The Health Insurance Portability and Accountability Act of 1996 (HIPAA) was passed by United National Congress and signed by the then president Bill Clinton on August 21, 1996. The main objective of this act was to amend the Internal Revenue Code of 1986 to improve portability and continuity of health insurance coverage in the group and individual markets, to combat waste, fraud, and abuse in health insurance and health care delivery, to promote the use of medical savings accounts, to improve access to long-term care services and coverage and to simplify the administration of health insurance.
Also, to combat waste, fraud and abuse in health insurance and health care delivery. It even includes promoting the use of medical savings accounts and improving access to long-term care services and coverage and simplifying the administration of health insurance.
HIPAA has two titles. Title I protect health insurance coverage for workers and their families when they change or lose their jobs. Title II, known as the Administrative Simplification provisions make it mandatory for providers, health insurance plans and employees to establish the national standards for electronic healthcare transactions and maintain national identifiers or credentials. AS also addresses the security and privacy of health data. There are subsections of the law related to administrative simplification and confidentiality of protected health information that has far-reaching effects for Providers, Payers, Managed Care Organizations, their business associates, and any entity storing, processing, and transmitting healthcare information.