1. HIPAA Vendor Conference Greg Moody Executive Assistant for Health and Human Services Office of Ohio Governor Bob Taft

2. HIPAA – The Foundation  The Health Care Modernization and Security Act of 1993  President Clinton’s Health Security Act  Medicare Reform  Health Insurance Portability and Accountability Act of 1996

3. Health Care – Taking Its Place in the Information Economy  Health care Industry has been slow in embracing the information economy No one entity has the market power to force adoption of a common set of standards No one entity has the market power to force adoption of a common set of standards Entities have invested heavily in proprietary data systems Entities have invested heavily in proprietary data systems Privacy concerns have made payers and providers reluctant to move away from the legal security of paper records Privacy concerns have made payers and providers reluctant to move away from the legal security of paper records

4. HIPAA - Impact  HIPAA is the single most significant piece of federal legislation affecting the health care industry since the inception of the Medicare and Medicaid programs in 1965  HIPAA compliance will be the top business issue facing the health care industry for the next two years

5. Inevitable Transformation...  The constant demand for more information in less time is pushing health care systems toward electronic data interchange, the computer-to-computer exchange of information in a standard format  Institutions utilize electronic data interchange internally, but encounter barriers to sharing data externally.

6. Opportunities to Decrease Costs…  Enable the use of the Internet instead of expensive, private networks  Develop less costly “off-the-shelf” management information systems solutions  Reduce unnecessary paperwork  Increase the speed and accuracy of transactions  Expose fraud in ways that are impossible under the current paper system

7. Opportunities to Increase Quality…  Strengthen privacy and confidentiality associated with protected health information  Aggregate and compare data (non-standard code sets make this difficult to do today)  Provide the data consumers need to compare the value of insurance plans and health services  Forge stronger cooperative relationships with providers (“We’re all in this together”)  Upgrade existing outdated technology

8. Opportunities for Business Transformation…  Administrative Simplification is a business challenge—not just a technical issue  Existing technology is applied to improve business practices  People, paper, and postage are replaced with electronic communications to reduce costs and improve services  Administrative Simplification can be viewed as a conformance nuisance or as a catalyst to e-business

9. Conclusions  Health care payers and providers that see HIPAA as a catalyst for modernizing their business practices will make the inevitable transformation toward electronic commerce and recognize significant long- term benefits  Payers and providers that view HIPAA as a federal compliance issue will in the long- term fall behind their competitors