Who Really Pays the Freight?

For years hospitals and physicians have utilized third parties to manage their medical records and respond to requests for copies from patients, attorneys, insurance companies, etc. I will admit, at times it seemed like the charge imposed for obtaining copies of medical records hedged on outrageous. These companies made a great deal of money managing providers’ records. Much of that came to a screeching halt in 2013 when the Department of Health and Human Services issued a final rule entitled Modifications to the HIPAA Privacy, Security and Enforcement Rules. The 2013 Final Rule indicated the small fee a provider can charge an individual to obtain an electronic copy of their medical records also extended to third parties operating on behalf of the individual. In other words, an individual could direct that a copy of his or her records be sent to an attorney for example and the records management company could only charge the small fee it was allowed to charge an individual for electronic copies.

As you might expect, one of the records management companies, Ciox Health, LLC filed a federal lawsuit asking the court to vacate what is called the “third party directive” portion of the 2013 Final Rule. On January 23, 2020 a federal court granted their wish and entered an order vacating the third party directive which means the records management companies are again free to charge extremely high prices anytime an individual requests a copy of their records be sent to anyone but themselves.

I believe the vacation of the third party directive is detrimental to individuals; any third party, such as an attorney, that requests copies of medical records, regardless of the purpose of such request, will now likely have to pay high fees for those copies and will simply pass that cost along to the individual who is the client. In the end, the individual is the person who has to bear the high cost of record management and retrievable. The Office for Civil Rights has continually indicated its goal is to ensure patients/individuals have more access to their medical records and it seems this court order has taken the system backwards rather than forwards.