Telemedicine and Privacy: Texas Takes
an Important Step to Overcome a Major Legal Barrier
Facing the Answer to Its Rural Health Care Crisis

By Lucinda R. Daniels, J.D., LL.M. Candidate

Improving access and availability of timely and quality health care services for its 3.1 million rural inhabitants has been an ongoing challenge for the Texas state government and rural areas.  A review of data compiled by the Texas Department of Health-Data, Policy & Analysis, reveals that a disproportionate 173 of the 196 rural counties in Texas have been designated as medically underserved areas. See http://www.crhi.state.tx.us/demographics/3.jpg.  Rural Texas also has a severe physician shortage, in fact, a vast majority of its rural counties have been designated as Health Professional Shortage Areas by the U.S. Department of Health and Human Services. See http://www.chri.state.tx.us/demographics/2jpg.  The health care provider shortage, as well as a variety of other social, economic, and geographical barriers have contributed tremendously to the inadequate or nonexistent health care received by rural Texans.  Fortunately, the clever combination of technological communications and the practice of medicine, commonly known as “telemedicine,” presents the opportunity for states to expand the availability and affordability of health care services to rural areas.

Demonstration projects have shown that telemedicine improves access, quality, and costs of rural health care.  Yet, its rapid growth presents state and federal lawmakers with a variety of legal issues; including, but not limited to:  privacy, reimbursement, licensure and liability.   However, privacy is at the forefront of legal issues because it affects the degree to which rural residents will feel comfortable enough to accept telemedicine in lieu of direct personal attention.  Privacy concerns must be sufficiently addressed before rural patients will accept telemedicine as a safe and secure method of health care delivery.  The failure to address this issue could inhibit the growth of telemedicine and impair its potential to resolve the issues of health care access and cost in rural areas.

Texas, in an effort to resolve its rural health care crisis, has been among the leading states taking active roles in fostering the growth of telemedicine.  The 77th Texas Legislature passed an important piece of legislation that directly addressed the privacy concerns surrounding the use of telemedicine.
 
Telemedicine involves the electronic transfer of patient medical records and information from one location to another via the Internet, or other computerized mediums. See Kip Poe, Telemedicine Liability: Texas and Other States Delve into the Uncertainties of Health Care Delivery via Advanced Communications Technology, 20 Rev. Litig. 681, 684 (2001). Thus, telemedicine presents significant challenges for safeguarding the privacy and confidentiality of patient health information.  The use of advanced technology increases the possibility of unauthorized disclosure and/or use.  Prior to the passage of Senate Bill 11, telemedicine beneficiaries in Texas had legitimate concerns regarding privacy and confidentiality because the initial statutes controlling the practice of telemedicine were inadequate with regard to confidentiality.  The statutes required confidentiality of patient information but neglected to address how it was to be achieved. See Tex. Occ. Code Ann. §§ 159, 160 (Vernon 2000).  S.B. 11 does much to alleviate patient concerns with privacy and confidentiality.  The new law, among other things, requires covered entities to comply with the federal Health Insurance Portability and Accountability Act (HIPAA) privacy standards relating to a patient’s protected health  information, which includes identifiable electronic information either transmitted or maintained in a computer. See S.B. 11, 2001 Leg., 77th Sess. (Tex. 2001).  More specifically, covered entities will be required to comply with HIPAA privacy standards with regard to an individual’s access to protected health information; uses and disclosures of protected health information, including consent; amendment of protected health information; and notice of privacy practices. See id.  A covered entity is broadly defined in the bill to include anyone who uses protected health information with a few limited exceptions. See id.  Thus, S.B. 11 expands the privacy protection offered by HIPAA, which merely extends to health care providers, health care plans, or a health care clearing house.  An important highlight of the new bill is that it prohibits the reidentification or marketing of protected information without patient consent or authorization.  The enforcement provisions of the S.B. 11 are also worthy of recognition because they treat violations as serious infractions, by authorizing the Attorney General to institute injunctive relief and/or civil penalties of $3,000 for each violation.  In addition, a $250,000 fine may be imposed if violations qualify as pattern or continuous.  Violations may also result in disciplinary actions by licensing authorities and exclusion from state funded health care programs.

This new legislation is a significant step in the direction of providing patients with increased protection of medical records and personal information.  As a result of this bill, health care providers and other covered third parties involved in the telemedical process now have precise guidelines to follow with regard to the disclosure and use of patient information.  They also have incentives to follow those guidelines that are in the form of fines and disciplinary action.  In addition, patients who might ordinarily resist telemedicine treatment for fear that their personal health information might be released to a third party without their knowledge or consent are now afforded an increased level of security in knowing that there are specific privacy regulations on the practice of telemedicine.  Patients can also feel secure in knowing that violators of these rules will have to suffer certain penalties.

Texas, with its severe physician shortage and remote rural counties, can readily benefit from using telemedicine technology to help treat its medically underserved rural inhabitants.  Texas has a long way to go before its rural health care crisis will be fully resolved.   However, Texas lawmakers have realized that telemedicine has the potential to remedy many of the problems facing health care access in rural areas, and they are taking steps to promote its acceptance and growth.  The recently enacted privacy legislation is certain to calm fears associated with the electronic transmission of protected health information and foster patient acceptance of telemedical services.  Although it is impossible to determine how long the process will take, as telemedicine gains increased acceptance, the rural health care crisis is sure to diminish.

03/04/02