[Federal Register Volume 66, Number 29 (Monday, February 12, 2001)]
[Notices]
[Pages 9858-9862]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-3511]


-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Care Financing Administration


Privacy Act of 1974; Report of New System

AGENCY: Department of Health and Human Services (HHS), Health Care 
Financing Administration (HCFA).

ACTION: Notice of new system of records.

-----------------------------------------------------------------------

SUMMARY: In accordance with the requirements of the Privacy Act of 
1974, we are proposing to establish a new system of records, 
``Complaints Against Health Insurance Issuers and Health Plans 
(CAHII)'' HHS/HCFA/CMSO, System No. 09-70-9005. The CAHII will enable 
HCFA to fulfill its statutory charge to enforce four Federal Acts, 
which is mandated by the Public Health Service (PHS) Act at sections 
2722 and 2761 (42 U.S.C. 300gg-22 and 300gg-61). Specifically, Section 
2722 requires HCFA to enforce Title I of the Health Insurance 
Portability and Accountability Act of 1996 (HIPAA), the Mental Health 
Parity Act of 1996 (MHPA), the Newborns' and Mothers' Health Protection 
Act of 1996 (NMHPA), and the Women's Health and Cancer Rights Act of 
1998 (WHCRA) with respect to non-Federal governmental plans. Section 
2722 also requires HCFA to enforce these provisions with respect to 
health insurance issuers in the group market in States that fail to 
substantially do so. Section 2761 requires HCFA to enforce certain 
HIPAA Title I requirements with respect to health insurance issuers in 
the individual market in States that substantially fail to do so and 
fail to submit an acceptable alternative mechanism. Section 2761 also 
requires HCFA to enforce NMHPA and WHCRA with respect to health 
insurance issuers in the individual market in States that substantially 
fail to do so.
    We have provided background information about the proposed system 
in the Supplementary Information section below. Although the Privacy 
Act requires only that the ``routine use'' portion of the system be 
published for comment, HCFA invites comments on all portions of this 
notice. See Effective Dates section for comment period.

[[Page 9859]]


Effective Dates: HCFA filed a new system report with the Chair of the 
House Committee on Government Reform and Oversight, the Chair of the 
Senate Committee on Governmental Affairs, and the Administrator, Office 
of Information and Regulatory Affairs, Office of Management and Budget 
(OMB) on February 6, 2001. To ensure that all parties have adequate 
time in which to comment, the new system of records, including routine 
uses, will become effective 40 days from the publication of the notice, 
or from the date it was submitted to OMB and the Congress, whichever is 
later, unless HCFA receives comments that require alterations to this 
notice.

ADDRESSES: The public should address comments to: Director, Division of 
Data Liaison and Distribution (DDLD), HCFA, Room N2-04-27, 7500 
Security Boulevard, Baltimore, Maryland 21244-1850. Comments received 
will be available for review at this location, by appointment, during 
regular business hours, Monday through Friday from 9 a.m.-3 p.m., 
Eastern Time zone.

FOR FURTHER INFORMATION CONTACT: Mr. Dave Mlawsky, 410-786-6851, Health 
Insurance Specialist, Private Health Insurance Group, HCFA, 7500 
Security Boulevard, Mail Stop S3-16-26, Baltimore, Maryland 21244-1850.

SUPPLEMENTARY INFORMATION:

I. Description of the New System of Records

Statutory and Regulatory Basis for System of Records

    HCFA proposes a new system of records to collect, retrieve and act 
on information obtained when consumers contact HCFA and inform the 
agency that their health insurance issuer and/or non-Federal 
governmental health plan allegedly has violated Title I of the Health 
Insurance Portability and Accountability Act of 1996 (HIPAA), the 
Mental Health Parity Act of 1996 (MHPA), the Newborns' and Mothers' 
Health Protection Act of 1996 (NMHPA), and the Women's Health and 
Cancer Rights Act of 1998 (WHCRA). HIPAA aims to ensure the 
availability of health coverage for certain people who change or lose 
their jobs, and to small businesses, by imposing a number of 
requirements on health insurance issuers and certain types of group 
health plans. MHPA generally prohibits health insurance issuers in the 
large group market and certain types of health plans from setting lower 
annual and lifetime dollar coverage limits for mental health benefits 
than for medical/surgical benefits. NMHPA generally prohibits health 
insurers and certain types of health plans from covering post-
childbirth maternity stays of less than 48 hours following a normal 
delivery and 96 hours following a cesarean section. WHCRA generally 
requires health insurance issuers and certain types of health plans 
that provide mastectomy benefits to also provide certain follow-up 
care. The portions of these Acts that apply to non-Federal governmental 
health plans and to health insurance issuers have been codified in the 
PHS Act. This system of records is necessary for HCFA to fulfill its 
statutory charge to enforce these four Federal Acts, which is mandated 
by the PHS Act at sections 2722 and 2761 (42 U.S.C. 300gg-22 and 300gg-
61). Specifically, section 2722 requires HCFA to enforce Title I of 
HIPAA, MHPA, NMHPA and WHCRA with respect to non-Federal governmental 
plans. Section 2722 also requires HCFA to enforce these provisions with 
respect to health insurance issuers in the group market in States that 
fail to substantially do so. Section 2761 requires HCFA to enforce 
certain HIPAA requirements with respect to health insurance issuers in 
the individual market in States that substantially fail to do so and 
fail to submit an acceptable alternative mechanism. Section 2761 also 
requires HCFA to enforce NMHPA and WHCRA with respect to health 
insurance issuers in the individual market in States that substantially 
fail to do so.

II. Collection and Maintenance of Data in the System

Scope of the Data Collected

    The collected information will include a consumer's name, address, 
phone number, the name and address of their health plan or health 
insurance issuer, their plan ID number or social security number, the 
nature of their complaint/inquiry against their health plan or issuer, 
and any medical and other additional information that is necessary for 
HCFA to help resolve the consumer's complaint.

Agency Policies, Procedures, and Restrictions on the Routine Use

    The Privacy Act permits us to disclose information without an 
individual's consent if the information is to be used for a purpose, 
which is compatible with the purpose(s) for which the information was 
collected. Any such disclosure of data is known as a ``routine use.'' 
The government will only release information contained in this system 
of records as provided for under Section III ``Proposed Routine Use 
Disclosures of Data in the System''.
    We will only disclose the minimum personal data necessary to 
achieve the purpose of the system of records. HCFA has the following 
policies and procedures concerning disclosures of information, which 
will be maintained in the system. Disclosure of information from the 
system of records will be approved only for the minimum information 
necessary to accomplish the purpose of the disclosure after HCFA:
    (a) Determines that the use or disclosure is consistent with the 
reason that the data is being collected; i.e., assisting consumers to 
resolve their complaints and/or inquiries regarding their rights under 
Title I of HIPAA, MHPA, NMHPA and/or WHCRA,
    (b) Determines:
    (1) That the purpose for which the disclosure is to be made can 
only be accomplished if the record is provided in individually 
identifiable form;
    (2) That the purpose for which the disclosure is to be made is of 
sufficient importance to warrant the effect and/or risk on the privacy 
of the individual that additional exposure of the record might bring; 
and
    (3) That there is a strong probability that the proposed use of the 
data would in fact accomplish the stated purpose(s).
    (c) Determines that the data are valid and reliable.

III. Proposed Routine Use Disclosures of Data in the System

    The routine use disclosures in this system may occur only to the 
following categories of entities (i.e., the entities, which can get 
identifiable data only if we apply the policies and procedures in 
Section II. B. above). Disclosures may be made:
    1. To agency contractors, or consultants who have been engaged by 
the agency to assist in accomplishment of an HCFA function relating to 
the purposes for this system of records and who need to have access to 
the records in order to assist the HCFA.
    We contemplate disclosing information under this routine use only 
in situations in which HCFA may enter a contractual or similar 
agreement with a third party to assist in accomplishing HCFA functions 
relating to purposes for this system of records. HCFA occasionally 
contracts out certain of its functions when this would contribute to 
effective and efficient operations. HCFA must be able to give a 
contractor whatever information is necessary for the contractor to 
fulfill its duties. In these situations, safeguards are provided in the 
contract prohibiting the contractor from using or disclosing the 
information for any purpose other than that described in the contract 
and to

[[Page 9860]]

return or destroy all information at the completion of the contract.
    2. To a Member of Congress or to a congressional staff member in 
response to an inquiry of the Congressional Office made at the written 
request of the constituent about whom the record is maintained.
    Beneficiaries sometimes request the help of a member of Congress in 
resolving some issue relating to a matter before HCFA. The member of 
Congress then writes HCFA, and HCFA must be able to give sufficient 
information to be responsive to the inquiry.
    3. To the Department of Justice (DOJ), court or adjudicatory body 
when:
    (a) The agency or any component thereof; or
    (b) Any employee of the agency in his or her official capacity; or
    (c) Any employee of the agency in his or her individual capacity 
where the DOJ has agreed to represent the employee; or
    (d) The United States Government;

Is a party to litigation or has an interest in such litigation, and by 
careful review, HCFA determines that the records are both relevant and 
necessary to the litigation.
    Whenever HCFA is involved in litigation, or occasionally when 
another party is involved in litigation and HCFA's policies or 
operations could be affected by the outcome of the litigation, HCFA 
would be able to disclose information to the DOJ, court or adjudicatory 
body involved. A determination would be made in each instance that, 
under the circumstances involved, the purposes served by the use of the 
information in the particular litigation is compatible with a purpose 
for which HCFA collects the information.
    4. To a health insurance issuer and/or health plan, who has been 
named in a complaint and is believed to be potentially in violation of 
relevant portions of the PHS Act.
    When individuals file complaints or inquiries asking HCFA to 
clarify or enforce their rights under Title I of HIPAA, MHPA, NMHPA 
and/or WHCRA, HCFA often must disclose information maintained in this 
system of records to the individual's health insurance issuer or health 
plan in order for HCFA to satisfy its statutory charge to enforce these 
Federal Acts with respect to non-Federal governmental health plans in 
all States and health insurance issuers in some States.
    5. To another Federal or State agency:
    (a) To refer a complaint or inquiry with respect to Title I of 
HIPAA, MHPA, NMHPA and WHCRA or
    (b) To enable such agency to administer a Federal health benefits 
program, or as necessary to enable such agency to fulfill a requirement 
of a Federal statute or regulation that implements a health benefits 
program funded in whole or in part with Federal funds.
    HCFA shares enforcement responsibilities with the U.S. Department 
of Labor, the U.S. Department of Treasury and State regulatory bodies 
with respect to Title I of HIPAA, MHPA, NMHPA and WHCRA. HCFA's 
enforcement responsibilities are discussed in the ``Description of the 
New System of Records'' section above. The Department of Labor enforces 
Title I of HIPAA, MHPA, NMHPA and WHCRA with respect to private group 
health plans. The Department of Treasury may levy excise taxes against 
private group health plans that do not comply with these Acts, except 
for WHCRA. In States that are substantially enforcing Title I of HIPAA, 
MHPA, NMHPA and WHCRA, the appropriate State agency enforces these 
provisions with respect to health insurance issuers. Occasionally, HCFA 
will receive an inquiry or complaint related to one of these four Acts 
in situations where it is within Labor's or Treasury's or a State's, 
and not HCFA's, jurisdiction to resolve. In such cases, HCFA must 
disclose information from the system of records to the appropriate 
agency so they can perform their enforcement function.
    6. To third party contacts when the party to be contacted has, or 
is expected to have, information relating to the individual's complaint 
against a health insurance issuer and/or health plan, when:
    (a) The individual is unable to provide the information being 
sought. An individual is considered unable to provide certain types of 
information when:
    (1) He or she is incapable or of questionable mental capability;
    (2) He or she cannot read or write;
    (3) He or she has a hearing impairment; and is contacting HCFA by 
telephone through a telecommunications relay system operator;
    (4) He or she cannot afford the cost of obtaining the information;
    (5) A language barrier exists; or
    (6) The custodian of the information will not; as a matter of 
policy, provide it to the individual; or
    (b) The data are needed to establish the validity of evidence or to 
verify the accuracy of information presented by the individual 
concerning his or her complaint against a health insurance issuer and/
or health plan; or HCFA is reviewing the information as a result of 
suspected violation of the PHS Act.
    Although most of the information that will be maintained in this 
system will already be in HCFA's files, HCFA will occasionally need to 
obtain additional information from other sources. When an individual 
has difficulty communicating with HCFA or obtaining needed information 
because of a physical handicap, a language barrier, or other reason, 
HCFA helps the individual as needed. There can also be other situations 
in which HCFA requests information from a source other than the subject 
individual. To request needed information from such other sources, HCFA 
must disclose minimal information about the individual to them, for 
example, information identifying the individual and the fact that the 
subject individual is making a complaint against an health insurance or 
health plan.

IV. Safeguards

    A. Authorized users: Personnel having access to the system have 
been trained in Privacy Act requirements. Records are used in a 
designated work area and system location is attended at all times 
during working hours.
    <bullet> To ensure security of the data, the proper level of class 
user is assigned for each individual user level. This prevents 
unauthorized users from accessing and modifying critical data.
    B. Physical Safeguards: All server sites have implemented the 
following minimum requirements to assist in reducing the exposure of 
computer equipment and thus achieve an optimum level of protection and 
security for the CAHII system:
    Access to all servers is controlled, with access limited to only 
those support personnel with a demonstrated need for access. Servers 
are to be kept in a locked room accessible only by specified management 
and system support personnel. Each server requires a specific log-on 
process. All entrance doors are identified and marked. A log is kept of 
all personnel who were issued a security card, key and/or combination, 
which grants access to the room housing the server, and all visitors 
are escorted while in this room. All servers are housed in an area 
where appropriate environmental security controls are implemented, 
which include measures implemented to mitigate damage to Automated 
Information Systems (AIS) resources caused by fire, electricity, water 
and inadequate climate controls.
    Protection applied to the workstations, servers and databases 
include:

[[Page 9861]]

    <bullet> User Log-on--Authentication is performed by the Primary 
Domain Controller/Backup Domain Controller of the log-on domain.
    <bullet> Workstation Names--Workstation naming conventions may be 
defined and implemented at the agency level.
    <bullet> Hours of Operation--May be restricted by Windows NT. When 
activated all applicable processes will automatically shut down at a 
specific time and not be permitted to resume until the predetermined 
time. The appropriate hours of operation are determined and implemented 
at the agency level.
    <bullet> Inactivity Lockout--Access to the NT workstation is 
automatically locked after a specified period of inactivity.
    <bullet> Warnings--Legal notices and security warnings display on 
all servers and workstations.
    <bullet> Remote Access Security--Windows NT Remote Access Service 
(RAS) security handles resource access control. Access to NT resources 
is controlled for remote users in the same manner as local users, by 
utilizing Windows NT file and sharing permissions. Dial-in access can 
be granted or restricted on a user-by-user basis through the Windows NT 
RAS administration tool.
    There are several levels of security found in the CAHII system. 
Windows NT provides much of the overall system security. The Windows NT 
security model is designed to meet the C2-level criteria as defined by 
the U.S. Department of Defense's Trusted Computer System Evaluation 
Criteria document (DoD 5200.28-STD, December 1985). Netscape Enterprise 
Server is the security mechanism for all CAHII transmission connections 
to the system. As a result, Netscape controls all CAHII information 
access requests. Anti-virus software is applied at both the workstation 
and NT server levels.
    Access to different areas on the Windows NT server are maintained 
through the use of file, directory and share level permissions. These 
different levels of access control provide security that is managed at 
the user and group level within the NT domain. The file and directory 
level access controls rely on the presence of an NT File System (NTFS) 
hard drive partition. This provides the most robust security and is 
tied directly to the file system. Windows NT security is applied at 
both the workstation and NT server levels.
    C. Procedural Safeguards: All automated systems must comply with 
Federal laws, guidance, and policies for information systems security. 
These include, but are not limited to: the Privacy Act of 1974; the 
Computer Security Act of 1987; OMB Circular A-130, revised; Information 
Resource Management (IRM) Circular #10; HHS Automated Information 
Systems Security Program; the HCFA Information Systems Security Policy 
and Program Handbook; and other HCFA systems security policies. Each 
automated information system should ensure a level of security 
commensurate with the level of sensitivity of the data, risk, and 
magnitude of the harm that may result from the loss, misuse, 
disclosure, or modification of the information contained in the system.

V. Effect of the Proposed System of Records on Individual Rights

    HCFA proposes to establish this system in accordance with the 
principles and requirements of the Privacy Act and will collect, use, 
and disseminate information only as prescribed therein. Data in this 
system will be subject to the authorized releases in accordance with 
the routine uses identified in this system of records.
    HCFA will monitor the collection and reporting of data. HCFA will 
collect only that information necessary to perform the system's 
functions. In addition, HCFA will make disclosure from the proposed 
system only with consent of the subject individual or his/her legal 
representative, in accordance with an applicable exception provision of 
the Privacy Act, or in accordance with the routine uses enumerated in 
Section III.
    HCFA, therefore, does not anticipate an unfavorable effect on 
individual privacy as a result of maintaining this system of records.

    Dated: February 6, 2001.
Michael McMullan,
Acting Deputy Administrator, Health Care Financing Administration.
No. 09-70-9005

SYSTEM NAME:
    Complaints Against Health Insurance Issuers and Health Plans 
(CAHII), HHS/HCFA/CMSO.

SECURITY CLASSIFICATION:
    Level 3, Privacy Act Sensitive Data.

SYSTEM LOCATION:
    7500 Security Boulevard, South Building, Third Floor, Baltimore, 
Maryland 21244-1850. Portions of the system of records will be 
maintained at various HCFA regional offices.

CATEGORIES OF INDIVIDUALS COVERED BY THE SYSTEM:
    Consumers who contact HCFA with complaints that their health 
insurance issuer or health plan is violating Title I of the Health 
Insurance Portability and Accountability Act of 1996 (HIPAA), the 
Mental Health Parity Act of 1996 (MHPA), the Newborns' and Mothers' 
Health Protection Act of 1996 (NMHPA), and the Women's Health and 
Cancer Rights Act of 1998 (WHCRA); as well as consumers who contact 
HCFA with inquiries about the consumer protections offered by one or 
more of these Acts.

CATEGORIES OF RECORDS IN THE SYSTEM:
    This system will contain the consumer's name, social security 
number or health plan ID number, address, phone number, the name and 
address of their health insurance issuer or health plan, the nature of 
their complaint or inquiry, and any relevant medical or other 
information necessary to resolve their complaint against their health 
insurance issuer or health plan.

AUTHORITY FOR MAINTENANCE OF THE SYSTEM:
    Section 2722 of the PHS Act (42 U.S.C. 300gg-22) and section 2761 
(42 U.S.C. section 300gg-61).

PURPOSE(S):
    The primary purpose of the system of records is to enable HCFA to 
collect, retrieve and act on information obtained when consumers 
contact HCFA and inform the agency that their health insurance issuer 
and/or health plan has violated Title I of HIPAA, MHPA, NMHPA, or 
WHCRA. Consumers will direct these complaints to HCFA's central office, 
and to HCFA's regional offices. Relevant information about each 
complaint is documented on paper at each HCFA location that receives 
complaints. The system of records will be maintained at several 
locations. HCFA will use information retrieved from this system of 
records to enforce these four Acts by assisting individuals in securing 
their rights under them. HCFA also will use information retrieved from 
this system of records to identify any patterns of violations that will 
help HCFA determine whether targeted outreach and education efforts are 
needed.

ROUTINE USES OF RECORDS MAINTAINED IN THE SYSTEM, INCLUDING CATEGORIES 
OF USERS AND THE PURPOSES OF SUCH USES:
    The Privacy Act permits us to disclose information without an 
individual's consent if the information is to be used for a purpose 
that is compatible with the purpose(s) for which the information was 
collected. Any such compatible use of data is known as a ``routine 
use.'' The proposed routine uses in this system meet the compatibility 
requirement of the Privacy Act. We are proposing to establish the 
following routine use

[[Page 9862]]

disclosures of information, which will be maintained in the system. 
These routine uses are discussed in detail in the attached Preamble.
    1. To agency contractors, or consultants who have been engaged by 
the agency to assist in accomplishment of an HCFA function relating to 
the purposes for this system of records and who need to have access to 
the records in order to assist the HCFA.
    2. To a Member of Congress or to a congressional staff member in 
response to an inquiry of the Congressional Office made at the written 
request of the constituent about whom the record is maintained.
    3. To the Department of Justice (DOJ), court or adjudicatory body 
when:
    (a) The agency or any component thereof; or
    (b) Any employee of the agency in his or her official capacity; or
    (c) Any employee of the agency in his or her individual capacity 
where the DOJ has agreed to represent the employee; or
    (d) the United States Government;
    Is a party to litigation or has an interest in such litigation, and 
by careful review, HCFA determines that the records are both relevant 
and necessary to the litigation.
    4. To a health insurance issuer and/or health plan, that has been 
named in a complaint and is believed to be in violation of relevant 
portions of the PHS Act.
    5. To another Federal or State agency:
    (a) To refer a complaint or inquiry with respect to Title I of 
HIPAA, MHPA, NMHPA or WHCRA or
    (b) To enable such agency to administer a Federal health benefits 
program, or as necessary to enable such agency to fulfill a requirement 
of a Federal statute or regulation that implements a health benefits 
program funded in whole or in part with Federal funds.
    6. To third party contacts when the party to be contacted has, or 
is expected to have, information relating to the individual's complaint 
against a health insurance issuer and/or health plan, when:
    (a) The individual is unable to provide the information being 
sought. An individual is considered unable to provide certain types of 
information when:
    (1) He or she is incapable or of questionable mental capability;
    (2) He or she cannot read or write;
    (3) He or she has a hearing impairment, and is contacting HCFA by 
telephone through a telecommunications relay system operator;
    (4) He or she cannot afford the cost of obtaining the information;
    (5) A language barrier exists; or
    (6) The custodian of the information will not, as a matter of 
policy, provide it to the individual; or
    (b) The data are needed to establish the validity of evidence or to 
verify the accuracy of information presented by the individual 
concerning his or her complaint against a health insurance issuer and/
or health plan; or HCFA is reviewing the information as a result of 
suspected violation of the PHS Act.

POLICIES AND PRACTICES FOR STORING, RETRIEVING, ACCESSING, RETAINING, 
AND DISPOSING OF RECORDS IN THE SYSTEM:
      

STORAGE:
    Information is maintained on paper.

RETRIEVABILITY:
    The records are retrieved by name and social security number.

SAFEGUARDS:
    HCFA has safeguards for authorized users and monitors such users to 
ensure against excessive or unauthorized use. Personnel having access 
to the system have been trained in the Privacy Act and systems security 
requirements.
    In addition, HCFA has physical safeguards in place to reduce the 
exposure of computer equipment and thus achieve an optimum level of 
protection and security for the CAHII system. Safeguards have been 
established in accordance with HHS standards and National Institute of 
Standards and Technology guidelines; e.g., limiting access to 
authorized personnel. System securities are established in accordance 
with HHS, Information Resource Management (IRM) Circular #10, Automated 
Information Systems Security Program; HCFA Automated Information 
Systems (AIS) Guide, Systems Securities Policies; and OMB Circular No. 
A-130 (revised) Appendix III.

RETENTION AND DISPOSAL:
    HCFA will retain CAHII data for a total period of seven (7) years 
after resolution of the inquiry/complaint.

SYSTEM MANAGERS AND ADDRESS:
    Director, Private Health Insurance Group, HCFA, 7500 Security 
Boulevard, Baltimore, Maryland 21244-1850.

NOTIFICATION PROCEDURE:
    For purpose of access, the subject individual should write to the 
system manager who will require the system name, the subject 
individual's name, social security number (SSN) (furnishing the SSN is 
voluntary, but it may make searching for a record easier and prevent 
delay), address, date of birth, and sex.

RECORD ACCESS PROCEDURE:
    For purpose of access, use the same procedures outlined in 
Notification Procedures above. Requestors should also reasonably 
specify the record contents being sought. (These procedures are in 
accordance with Department regulation 45 CFR 5b.5(a)(2).)

CONTESTING RECORD PROCEDURES:
    The subject individual should contact the system manager named 
above, and reasonably identify the record and specify the information 
to be contested. State the corrective action sought and the reasons for 
the correction with supporting justification. (These procedures are in 
accordance with Department regulation 45 CFR 5b.7.)

RECORD SOURCE CATEGORIES:
    Sources of information contained in this records system include 
data collected from the individuals themselves, and information 
collected from their health insurance issuer or health plan.

SYSTEMS EXEMPTED FROM CERTAIN PROVISIONS OF THE ACT:
    None.

[FR Doc. 01-3511 Filed 2-9-01; 8:45 am]
BILLING CODE 4120-03-P