The National Law Journal is reporting noticed provisions in the proposed stimulus bills - providing state attorneys general with new enforcement power for HIPAA violations, including civil damages and injunctions in federal courts. Marcia Coyle writes:

Both the House-passed economic stimulus bill and the proposed Senate version would give state attorneys general new enforcement authority to file civil actions for damages or injunctions in federal courts for violations of the federal Health Insurance Portability and Accountability Act (HIPAA).

The U.S. Chamber of Commerce's Institute for Legal Reform recently attacked the provisions in a letter to House and Senate leadership urging that the provisions be removed from both proposals. "While the emergency economic stimulus package is aimed at turning our economy around and getting Americans back to work, the provision slipped into the House version and included in the Senate proposal is nothing more than a gift to the plaintiffs' lawyers," said ILR President Lisa A. Rickard... But a spokesman for the trial lawyers' organization, the American Association for Justice, said, "AAJ did not lobby on this provision" and indicated it was a surprise to the organization.

HIPAA was adopted in 1996 to ensure health insurance coverage after leaving an employer and also to provide standards for facilitating health-care-related electronic transactions. It included provisions that required the federal government to adopt national standards for electronic health care transactions. At the same time, Congress recognized that advances in electronic technology could erode the privacy of health information and so Congress incorporated into HIPAA provisions that mandated adoption of federal privacy protections for certain individually identifiable health information.

The federal law does not pre-empt state laws in this area, and a number of states have enacted state HIPAAs with stronger privacy protections than the federal law. The economic stimulus bill would strengthen enforcement of the federal HIPAA in those states without state HIPAA laws. Besides damages and injunctions, state attorneys generals also could seek attorney fees and costs associated with pursuing federal civil actions.